Part 3: Growth Energy on Tax Incentive Models
“There were a number of key incentives passed in the Inflation Reduction Act. Some of that was broadening the use of existing tax incentives like 45Q for carbon sequestration utilization, and then there are newer credits 40B for sustainable aviation fuel, and then 45Z, which is the clean fuel production credit, the Department of Treasury and IRS are in the midst of writing the guidance and or rules to articulate exactly how these incentives are going to work. And so 45Q is relatively straightforward. It's an existing credit and you get a credit per tonne of carbon sequestered for 40B and for 45Z- 40B went into effect at the beginning of the year, but we're still waiting on guidance about how that would work. The big key question for that is modeling. The law specifies what they call the ICAO Corsia model, International Civil Aviation Organization. This is a standards-making body based largely in Europe. But you know, here in the US, we use the argon GREET model.”
The fourth and final report in this ethanol series coming up on Monday.