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As the Biden administration works to transition the airline industry to sustainable aviation fuels to combat greenhouse gas emissions, concerns are growing that the federal government is hastily making decisions that could impede the use of climate-smart biofuels, like corn ethanol, for the long term.
At the center of the issue is which model the Department of Treasury will use to assess reductions in GHG emissions as it considers tax credits for sustainable aviation fuels under the recently passed Inflation Reduction Act. The IRA allows for the allocation of tax incentives for biofuels that cut GHGs by 50% or more.
Corn growers have actively been pushing for Treasury to follow the U.S. Department of Energy’s model, called GREET, which includes GHG reductions from the farm all the way to the car or plane. This model is supported by leaders in the agricultural, aviation, and biofuel industries, as well as by a substantial number of policymakers.
While Treasury has indicated that it will embrace the GREET model, it appears it will do so with potentially misguided modifications.
There are numerous reasons why GREET, as originally designed, is the best model for determining GHG reductions from biofuels.
The U.S. Department of Energy created GREET, and it continues to be the federal government’s most robust and up-to-date methodology for transportation lifecycle assessment. It is used globally to measure lifecycle GHG emissions from transportation, and DOE has the best resources, expertise, and ability within federal government agencies to assess lifecycle emissions accurately and scientifically.
The GREET model accurately accounts for on-farm carbon reduction activities, feedstock yield increases, and the improved agriculture production practices that farmers have adopted over the last 20 years.
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In short, it is comprehensive in measuring all factors where other models do not.
Treasury is expected to finalize a decision on this issue in the coming weeks. If it decides against using the original GREET model, environmentally friendly biofuels may not qualify for the IRA tax incentive. This would not only come as a blow to farmers and rural communities, whose economies would benefit from the use of these biofuels in the airline industry, but it would also hamper the president’s efforts to combat climate change.
For his part, President Biden remains optimistic. In a recent speech in Maine, he noted, "Mark my words: the next 20 years, farmers are going to be providing 95% of all the sustainable airline fuel.”
That is good to hear, but if it is to become a reality, his administration is going to have to move quickly and choose a comprehensive GHG model that ensures farmers are at the table. That is why we strongly urge Treasury to include the original GREET model in its upcoming guidance.
Such a step would be important to farmers and crucial to the success of the president’s climate agenda.
Wolle, a Minnesota farmer, is president of the National Corn Growers Association.
