We, the undersigned – as business leaders masking practically the complete provide chain for Sustainable Aviation Gasoline (SAF) – are writing to precise our sturdy help for formal recognition of the U.S. Division of Power’s Argonne GREET mannequin as a “related methodology” beneath the Inflation Discount Act (IRA) Part 40B(e).
As you realize, our potential to draw funding and construct out U.S. SAF capability will rely upon how this system determines credit score eligibility and valuation. That is very true for a performance-based tax regime that ties the dimensions of the inducement to a product’s lifecycle carbon rating.
Whereas the statute rightly acknowledges the carbon lifecycle evaluation (LCA) mannequin developed by the Worldwide Civil Aviation Group (ICAO) as a way for figuring out SAF credit score eligibility and valuation, Congress was proper to explicitly permit for using “any related methodology.” The Division ought to instantly acknowledge Argonne GREET as an identical methodology for a number of causes.
First, Argonne GREET incorporates the newest biorefining and feedstock manufacturing efficiencies and is up to date usually. Accuracy, transparency, and predictability are important to securing non-public capital in a policy-driven market. Second, and in contrast to the ICAO mannequin, Argonne GREET permits customers to account for local weather sensible and regenerative feedstock manufacturing practices. The IRA might unleash a brand new wave of U.S. bio-innovation practices however won’t attain its full potential if these practices can’t be accounted for. Lastly, tying a U.S. SAF credit score to just one worldwide mannequin – in an inherently unsure technical discipline – will increase funding threat in direct contravention of the interagency SAF Roadmap’s purpose to “cut back [industry] threat throughout scale-up and operations.”
As as to whether Argonne GREET meets the statutory necessities for recognition as an identical methodology to ICAO/CORSIA, the fashions use the identical instruments to quantify lifecycle carbon emissions from SAF. Each approaches rely totally on GREET knowledge for direct (supply-chain) emissions and a common equilibrium financial mannequin referred to as GTAP to estimate oblique emissions (i.e., oblique land use change). Argonne GREET clearly complies with CAA § 211(o)(1)(H) as a result of the mannequin contains each side of the “full gasoline lifecycle,” together with each “direct emissions and important oblique emissions.” It additionally contains the one instance of great oblique emissions cited (“land use modifications”) and “all levels of gasoline and feedstock manufacturing and distribution … adjusted to account for his or her relative international warming potential.”
Whereas the scientific group’s understanding of various features of lifecycle carbon accounting is continually evolving, significantly with regard to oblique emissions, proposed important modifications needs to be run via the conventional scientific, company and public processes – and shouldn’t be added unexpectedly as a part of Treasury steerage.
We’re conscious that Argonne GREET is present process an replace. Science-based updates are a standard course of enterprise for lifecycle modeling and shouldn’t be trigger for delay. Our corporations are already engaged in discussions and business efforts to ramp up SAF manufacturing and feedstocks to satisfy the targets set forth by the U.S. and international local weather leaders. With the appropriate market alerts, we are able to de-carbonize aviation and spur a brand new wave of U.S. innovation and clear power jobs. Nonetheless, modeling uncertainty right now is a multiyear improvement drawback because of the buildout schedules of SAF manufacturing amenities. To this finish, we underscore the urgency for offering readability on this concern as quickly as attainable to make sure the efficient implementation and utilization of IRA Part 40B.
Respectfully, we encourage the administration to instantly acknowledge “the newest model” of the Argonne GREET mannequin – because the statute does for ICAO/CORSIA – as an identical methodology. Not like any new carbon modeling regime that will invite additional delay, recognizing Argonne GREET now provides SAF traders a well-settled, sturdy, and predictable framework for assessing program eligibility and threat with out undercutting ongoing and future modeling updates.
Our corporations are dedicated to a sustainable future and are targeted on accelerating the business deployment of SAF. We stay up for the chance to depend on this vitally necessary program.
