Alternative Fuel and Low-Emission Aviation Technology Program

The Inflation Reduction Act created a new $297 million grant program for projects related to the production, transportation, blending, and storage of sustainable aviation fuels, in addition to developing, demonstrating, or applying low-emission aviation technologies. The program will be administered by the Department of Transportation. While qualifying sustainable aviation fuels must reduce lifecycle greenhouse gas emissions by at least 50 percent, palm oil is the only feedstock that is specifically ineligible for grant/project funding. With a broad definition of other biomass/biofuel feedstocks eligible for grant funding, the program could result in increased production of fuels associated with market distortions and long-term environmental liabilities – at taxpayer expense.