US opens registration for SAF credits under 45Z


bp's Cherry Point refinery in Washington state where a biofuels production facility is planned to help make SAF.

The US Internal Revenue Service (IRS) released guidance on 45Z tax credit calling on sustainable aviation fuel (SAF) and non-SAF producers to sign up for the credit by July 15 in order to avail credits from January 1, 2025 onwards.

“Any taxpayer that may be seeking to claim the Section 45Z credit beginning in 2025 should register with the IRS as soon as possible, but no later than July 15, 2024, to obtain a signed registration letter before Jan. 1, 2025. A signed registration letter is required prior to production of clean fuels for entitlement to the Section 45Z credit,” said Holland & Knight in its commentary on the notice.

As per the notice, the IRS has divided credit eligibility of transportation fuel into SAF and non-SAF fuel.

SAF producers seeking the Clean Fuel Production Credit must submit Form 637. This form requires the following details:

Production Specifications: Indicate whether the SAF is produced under ASTM D7566 Annex or ASTM D1655 Annex A1. If applicable, specify the specific ASTM D7566 Annex used for the synthetic blending component.

Feedstock Information: Identify the feedstock(s) used in SAF production and their respective countries of origin.

Production Capacity and Volume: Report the annual volume of SAF produced and the annual fuel production capacity of each operational facility.

Facility Details: Provide a description and location of each production facility.

Business Relationships: Disclose the names and addresses of any agents or brokers involved in SAF buying, selling, or transportation. Additionally, list the business entities to which SAF is sold and those from which SAF is purchased, traded, transferred, or exchanged.

Transaction Volume: Report the annual volume of SAF bought, sold, traded, transferred, or exchanged.

“For purposes of the 45Z credit, SAF may be categorised as either a liquid fuel that meets the specifications of one of the ASTM D7566 Annexes (SAF synthetic blending component), or a co-processed liquid fuel that was produced by coprocessing petroleum with synthesised hydrocarbons derived from synthesis gas via the Fischer Tropsch process (FT hydrocarbons),” said the IRS notice.