Sponsors (4)
The bill boosts SAF production and industry certainty through larger, longer tax credits and clearer definitions to help cut aviation emissions, while increasing federal spending and concentrating benefits among producers with limited immediate savings for ordinary travelers and some feedstock restrictions.
SAF producers (and related energy-sector firms) gain materially better, more predictable project economics from higher per‑unit tax credits (35¢ or $1.00) and an extended credit window through 2033, improving investment certainty and likely accelerating SAF projects.
Incentivizing increased SAF production can reduce lifecycle greenhouse gas emissions from aviation over time if SAF displaces conventional jet fuel, benefiting public health and climate goals.
A clear statutory definition of SAF (tying to ASTM standards and excluding certain feedstocks) reduces regulatory uncertainty for producers and buyers, lowering compliance risk and simplifying implementation for the industry and government oversight.
Extending and restoring these tax credits increases federal tax expenditures, which could widen the federal deficit or crowd out other spending priorities unless offsets are provided.
The bill's benefits are concentrated for SAF producers and aviation fuel purchasers, so average consumers and travelers are unlikely to see significant near‑term price relief.
Excluding fuels derived from palm fatty acid distillates (palm FAD) narrows feedstock options, potentially harming some feedstock suppliers and small producers who relied on those markets.
Based on analysis of 2 sections of legislative text.
Restores reduced per-gallon credit rates for sustainable aviation fuel, defines eligible SAF feedstocks, and extends the clean fuel credit to December 31, 2033 (effective for fuel produced after 12/31/2025).
Official title: Amend the Internal Revenue Code of 1986 to reinstate the special rate calculation of the clean fuel production credit with respect to sustainable aviation fuel, and to extend the credit through 2033.
Introduced February 2, 2026 by Jerry Moran · Last progress February 2, 2026
Reinstates a reduced per-gallon tax rate for sustainable aviation fuel (SAF) by restoring two lowered per-unit credit rates for fuel from qualified facilities, clarifying the definition of SAF (meets specific ASTM standards and excludes palm FADs and petroleum), and extends the clean fuel production credit through December 31, 2033. The changes apply to fuels produced after December 31, 2025.