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Amends 26 U.S.C. 48 to add 'sustainable aviation fuel production property' as eligible energy property for the energy credit; adds a phaseout schedule tied to construction start dates; adds a new definition and recapture rule in subsection (c); and sets an effective date for fuel produced after December 31, 2025.
Amends section 911 of the FAA Modernization and Reform Act of 2012 (49 U.S.C. 44504) to (1) modify subsection (a) duties to assist in development and add duties to promote aviation sector net-zero emissions, study non-CO2 climate impacts and develop a methodology for quantifying non-CO2 impacts in lifecycle analyses; (2) add definitions for 'sustainable aviation fuel' and 'qualified feedstock'; and (3) add an authorization of appropriations of $35,000,000 per year for FY2026–FY2030.
Replaces/amends the termination provision of section 45Z(g) to set different termination dates for non-sustainable transportation fuel and sustainable aviation fuel.
Adds a new subsection (w) to 42 U.S.C. 7545 establishing a low carbon aviation fuel standard (definitions, targets for 2030 and 2050, benchmark timing, credit generation and use, accounting procedures, consultation requirements, state waiver, coordination with other laws, and reporting) and amends subsection (d) of section 7545 to make enforcement provisions apply to the new subsection (w).
Drives down aviation emissions by expanding tax credits and grants for sustainable aviation fuel (SAF), creating a federal low‑carbon aviation fuel standard, and setting national goals of a 35% cut in aviation greenhouse gases by 2035 and net‑zero by 2050. It also updates research programs, boosts funding, and directs the Department of Defense to buy at least 10% SAF when it is cost‑competitive and U.S.-produced. The plan adds SAF production equipment to the Energy Investment Tax Credit with safeguards, extends the clean fuel production credit for SAF through 2032, and phases out that credit for non‑SAF after 2027. EPA must set declining carbon‑intensity limits for aviation fuel with a credit trading system, while FAA and DOE expand research on non‑CO2 climate effects and new SAF feedstocks, including cover crops.
Adds a new subclause (X) to subsection (a)(2)(A)(i) of Section 48 to include “sustainable aviation fuel production property” among energy property types eligible for the Energy Credit.
Adds a new clause (xii) to subsection (a)(3)(A) of Section 48 to list “sustainable aviation fuel production property” as an item in paragraph (3)(A).
Inserts a new paragraph (16) titled “Phaseout for sustainable aviation fuel production property.” For energy property described in paragraph (3)(A)(xii) whose construction begins before January 1, 2039, the energy percentage used to calculate the credit is phased down by construction start date to: (A) 24 percent for property with construction beginning after December 31, 2030 and before January 1, 2032; (B) 18 percent for property with construction beginning after December 31, 2031 and before January 1, 2033; and (C) 12 percent for property with construction beginning after December 31, 2032 and before January 1, 2039.
Adds subsection (c)(9) defining “sustainable aviation fuel production property” to mean (A)(i) property which produces sustainable aviation fuel (as defined in section 40B(d)), or (A)(ii) property directly related to enabling the production or distribution of sustainable aviation fuel.
Requires the Secretary (by regulation) to provide for recapture of the benefit of any credit allowable under subsection (a)(3)(A)(xii) if the sustainable aviation fuel production of that property is less than 80 percent of the total fuel production of the property in any of the five taxable years immediately following the taxable year in which the property was placed in service.
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Referred to the Committee on Energy and Commerce, and in addition to the Committees on Transportation and Infrastructure, Armed Services, Science, Space, and Technology, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Introduced February 26, 2025 by Julia Brownley · Last progress February 26, 2025
Referred to the Subcommittee on Aviation.
Referred to the Committee on Energy and Commerce, and in addition to the Committees on Transportation and Infrastructure, Armed Services, Science, Space, and Technology, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
Introduced in House