Trump Presidency Poses Challenges for SAF Industry

The future of sustainable aviation fuels (SAF) could face significant challenges under President-elect Donald Trump, aviation industry officials warn. Members of the International Air Transport Association (IATA) and American Airlines (AAL) expressed concerns about the potential rollback of tax credits essential for SAF development.

The Role of Tax Credits in SAF Growth

The 2022 US Inflation Reduction Act (IRA) provided hundreds of billions of dollars in subsidies to support clean energy, including SAF production. The IRA is seen as a key catalyst for growth in the green jet fuel sector, encouraging investment in SAF production plants. However, Trump, a climate change skeptic, has vowed to rescind the IRA, which would require congressional support.

A rollback of these incentives could significantly hinder the expansion of SAF facilities. While current SAF production facilities may continue operations, new projects might be at risk without continued government backing.

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Europe’s SAF Goals and the Potential Impact

In Europe, the airline sector has been looking to the IRA as a model to stimulate investment in SAF production plants. Starting in 2026, European airlines must meet new mandates for SAF usage. The EU is likely to push forward with these regulations regardless of changes in the US, but any setback in the US could slow global progress.

Current State of Sustainable Aviation Fuel

At present, sustainable aviation fuel accounts for just 1% of the world’s jet fuel consumption. Experts agree that SAF production must ramp up significantly to help the aviation sector meet its net-zero emissions goal by 2050. Without sufficient government support and certainty, the growth of the SAF industry could be slowed.

American Airlines' head of intergovernmental affairs, Ronce Almond, emphasized that the market needs stability and long-term investment. Without government support, SAF production may not reach the necessary levels to meet emissions targets.

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Looking Ahead

Aviation officials are closely monitoring the new administration’s stance on climate policies. If tax incentives for SAF are reduced, the industry may face significant setbacks. Despite these challenges, the airline sector remains hopeful.

It is optimistic that governments worldwide will continue prioritizing sustainable aviation fuels to combat climate change. Achieving net-zero emissions by 2050 remains a key goal.