Sustainable aviation fuel efforts in the upper Midwest are on the move — and there's no place better prepared in the world than the Midwest to make it work.
That's according to Jeff Davidman, Delta Air Lines vice president of state and local government affairs. It's something he believes in so much that he shared the message to thousands of eventgoers between stops at the South Dakota Corn Conference, Minnesota Ag Expo, both in January, and once again at the Northern Corn and Soybean Expo in West Fargo, North Dakota, on Feb. 4. He even made his first appearance at the Minnesota House Agriculture Finance and Policy committee to boost SAF on Feb. 10.
"If you look at a map of the U.S., it really should be led not just in the U.S., but right here in the Midwest, because all the feedstocks that we need to make SAF are right here for soybeans and others," Davidman said to the crowd of corn and soybean producers and industry members. "We have a strong history, as everybody in this room knows, of producing biofuel."
Some recent examples of SAF movement in the upper Midwest include:
- Delta Air Lines celebrated its first flight using SAF blended with winter camelina on Sept. 25, 2024, at the Minneapolis-Saint Paul International Airport.
- Gevo received $1.5 billion from the Department of Energy in October 2024 for a SAF facility capable of producing about 65 million gallons of SAF per year. That plant is expected to start in 2026.
- DG Fuels chose Moorhead in October 2024 as the location of a $5-billion SAF plant capable of producing 193 million gallons of zero- or low-CO2 lifecycle emissions SAF per year. Production is expected to begin in 2030.
These actions are happening, according to Davidman, because there is a growing demand for SAF from the airline industry. The demand is there, he said, yet the industry and technology are just beginning. He says the Midwest has the product and is building an infrastructure that other countries are not comparable to.
SAF can be produced through corn, soybeans, cover crops, forestry residue, municipal solid waste and clean hydrogen. SAF, Davidman believes, can help the aviation industry achieve a goal of net zero carbon emissions by 2050 by replacing conventional jet fuel in aircraft and reducing their carbon footprint.
That goal of net zero is shared by The Sustainable Aviation Fuel Grand Challenge, a U.S. government-wide approach to working with industry to reduce cost, enhance sustainability, and expand production to achieve 3 billion gallons per year of domestic sustainable aviation fuel production that achieves a minimum of a 50% reduction in life cycle greenhouse gas emissions compared to conventional fuel by 2030 and 100% of projected aviation jet fuel use, or 35 billion gallons of annual production, by 2050.
While net-zero emissions is great, and a product that works is key, it's not without immense cost, at least initially, to build the necessary infrastructure. Low supply, high demand and costly startups mean it's currently two to five times more expensive than conventional gas to produce. When asked about the likelihood of SAF growing without government funding in these early stages, Davidman said it would be very difficult.
When asked about the affect that tax credits have on this progress, Minnesota Bio-Fuels Association executive director Brian Werner told the Minnesota House Agriculture Policy and Finance committee that tax credits are critical right now. Rolling back tax credits would make it more challenging, but not impossible, to grow SAF production.
Currently, the federal government's Inflation Reduction Act includes tax credits that came through in 2022 to support SAF production. That credit can vary from 35 cents to $1.75 per gallon, according to the Congressional Research Service.
Investments in SAF have also increased due to the U.S. Environmental Protection Agency's Renewable Fuel Standard, state programs and tax credits incentivizing use of the fuel. A current regulatory freeze by the Trump administration is adding a hiccup to the Inflation Reduction Act's Clean Fuel Production Credit or 45Z tax credit.
Because regulatory guidance from the U.S. Treasury came out just days before President Donald Trump returned to office, and because the Trump administration issued an executive order entitled "Regulatory Freeze Pending Review," this and many other funding sources are on hold pending a 60-day review.
"Treasury will ultimately need to formally issue a proposed rule to implement 45Z, accept and consider public comment, and issue a final rule," according to Dr. Adam Schubert, a senior associate at Stillwater Associates, a transportation fuels consulting firm. "This process could easily take a year. Until that happens, industry will continue in an uncomfortable state of being unable to confidently quantify the tax credit associated with their current fuel production. This uncertainty may force some producers, primarily smaller producers with weaker balance sheets, to shut down or restrict operations."
The Minnesota Sustainable Aviation Fuel (SAF) Tax Credit provides state tax credit to qualifying taxpayers for producing or blending SAF in the state between July 1, 2024, and June 30, 2030. That credit amount equals $1.50 for each gallon of SAF that is both produced in Minnesota or blended with aviation, gasoline, or jet fuel in Minnesota, and sold in Minnesota to a purchaser who certifies that the SAF is for use as fuel in an aircraft departing from an airport in Minnesota.
What that has done is allow production to blossom. In 2022, 25 million gallons of SAF were produced, increasing to 140 million gallons in 2023 and 340 million gallons in 2024, according to Davidman.
But production is still far from Delta's goal to reach 400 million gallons by 2030 and 35% of their overall use of fuel by 2035. And Delta is one among many in the industry that want to use SAF.
Delta Air Lines alone uses 4 billion gallons of jet fuel annually, with the U.S. airline industry using 30 billion gallons and the world using 50 billion gallons. The U.S. airline industry aims to replace 10% of conventional jet fuel with SAF by 2030, equating to 3 billion gallons.
"So we have a long way to go to get us to where we want to get to," he said.
While the current blend is 50/50 SAF and conventional jet fuel, Davidman said a Virgin Airlines flight of 100% SAF was successful. He sees the blend rate continuing to increase over time as it becomes more widely used in the industry. When asked about how jet engines respond to the different fuel, he said it makes no difference.
"So what we can do today is we can take 50% sustainable aviation fuel, we can blend it with 50% conventional jet fuel, and that is ASTM certified," Davidman said. "That is FAA certified. Our planes don't know the difference. Our engines don't know the difference."
"There is a global race to be first, and I'm excited to say that we in Minnesota today are near the front of the pack," said Peter Frosch, CEO of Greater MSP, the House ag committee.
Other regions are currently outpacing the Midwest in production of SAF, but that's largely through the use of used cooking oil. Gevo is the global leader of SAF production, producing about 2.5 billion gallons in 2023.
Frosch explained that the Minnesota SAF Hub has helped to develop a strategy for how to create a pathway for more SAF production. The Minnesota SAF Hub is a public, private partnership working towards creating the supply chain needed to create 1 billion gallons of SAF per year in Minnesota.
To continue to push for SAF production in the state, representatives of the Minnesota Corn Growers Association, Minnesota Soybean Growers Association, Delta, Minnesota Farmers Union and Minnesota Bio-Fuels Association spoke about how they can work with the Minnesota legislature to continue to grow the industry. Tax credits are part of that equation.
"Minnesota has plenty of feedstocks ready to go," she said. "We know that we are going to need everything and anything that's available to meet the demand."
Andrea Vaubel, deputy commissioner at the Department of Agriculture, urged the committee to focus on legislation that further boosts the sustainable aviation fuel industry, specifically, continuing the tax credits that can bring new investors to the table and build production efforts.
Vaubel noted that the state supported the tax credit effort at $11.6 million previously and Gov. Tim Walz's proposed budget is calling for further investment.
Davidman said tax credits won't be needed longterm, once the infrastructure and market catches up. He adds that SAF is the best bet right now as electricity will not be powering flights anytime soon.
"We are 75 years away from an electric plane that people would want their families to ride on," Davidman said.
Jacob Shapiro, a geopolitical speaker, was also one of the session speakers at the Northern Corn and Soybean Expo. He pondered if one of Trump's moves in Europe would be to get them to invest in U.S. SAF. Europe has the greatest demand for SAF yet they want nothing to do with soybean and corn feedstock, Shapiro said. He suggests that if the U.S. could get Europe to use 15-20% of their feedstock SAF in their blends, it could be a major export opportunity.
But he also spoke about the potential for the U.S. to grow domestic use of its agricultural products at a time when markets are changing around the world. He drew a picture of the rise of South America as the low-cost producer of corn and soybeans in the world, offering other nations a cheaper option over U.S. grains. So if the U.S. continues to lose footing to the growing acreage of Brazil, it may be better to build the domestic market.
"If you are looking for the best potential export market in the future for the United States — let it be the United States," Shapiro said.
