Following initial Treasury guidance in December 2023 that determined the GREET model did not satisfy the requirements to calculate emissions reductions for SAF, a federal Interagency Working Group consisting of USDA, DOE, FAA, and EPA committed to the release of an updated GREET model for SAF by March 1, 2024.
The modified GREET model released today will allow for producers of SAF to incorporate lifecycle carbon intensity reductions into the finished fuel from technologies such as carbon capture and sequestration, renewable electricity, renewable natural gas, and combined heat and power. The updated model will also allow for climate smart agricultural practices such as cover crops, conservation tillage, and nitrogen management to qualify for reduced carbon intensity scores if bundled together on a single farm operation.
Minnesota Bio-Fuels Association Executive Director, Brian Werner, reacted to the final guidance: “While Minnesota's biofuel industry welcomes the guidance on eligibility to qualify for SAF tax credits, we have great concerns about unnecessary limits on technologies and climate-smart practices that can be utilized to demonstrate carbon intensity reductions. The final guidance will prevent many of our state’s biorefineries and farmers from participating in this critical new market. Minnesota farmers who grow the feedstocks that the biofuel industry relies upon should not be penalized simply because our state’s climate is not conducive to growing a cover crop. We will be working with the administration and our federal delegation to address these concerns and ensure that Minnesota’s agriculture and biorefining sectors are not shut out from efforts to address climate change.”
This guidance will only apply to the 40B tax credit on SAF for 2023 - 2024. Additional updates and modifications to the GREET model are expected later this year on the Inflation Reduction Act’s Section 45Z - the Clean Fuel Production Credit. The 45Z credit will apply to carbon intensity reductions in fuels produced from 2025 – 2027.
The Minnesota Bio-Fuels Association has been advocating for the use of the most up-to-date science on lifecycle greenhouse gas emissions, as reflected in the Argonne National Laboratory’s GREET model. A project of the Department of Energy, the GREET model is viewed as the gold standard in measuring lifecycle greenhouse gas emissions through the entire lifecycle chain – from “well-to-wheels” and “well-to-wake”.
In August 2023, the Minnesota Bio-Fuels Association commended Minnesota Department of Agriculture Commissioner, Thom Petersen, for stressing to USDA Secretary Vilsack the importance of Minnesota’s agriculture and biofuel producers in decarbonizing the aviation sector.