US and UK introduce key SAF legislation

opinion

by Fayaz Hussain

May 27, 2025

Let’s talk about appendices attached to niche legislation. Great, now I know you are hooked. But it genuinely has been a landmark week for sustainable aviation fuel (SAF) legislation.

Yesterday, the US House of Representatives narrowly passed what President Trump called a “big, beautiful bill” that updates and extends the crucial 45Z tax credits for SAF production.

This legislation represents a significant step forward for SAF in the US. However, the extended credits will only apply to SAF produced from feedstocks sourced from the United States, Mexico and Canada.

Across the Atlantic, the UK government introduced its Sustainable Aviation Fuel Bill. The legislation centres on three fundamental pillars, with a revenue certainty mechanism (RCM) serving as its key cornerstone. The mechanism provides the financial stability that has long been sought by the country’s SAF sector, providing producers a guaranteed strike price that would make production viable.

The industry response has been notably positive. “The mechanism is one of several important tools to scale domestic UK SAF production, but it’s important we get the details right. We look forward to continuing working with UK government, particularly the Department for Transport, United Kingdom on its development and for now, welcome this historic milestone for the sector in the UK,” said LanzaJet CEO Jimmy Samartzis. LanzaJet is currently developing Project Speedbird, a 90,000-tonne SAF facility in England’s north east.

Similarly, OXCCU CEO Andrew Symes emphasised the transformative potential of the legislation. “The RCM provides much-needed stability for SAF producers, reducing cost volatility and creating a more predictable revenue stream for investors. This is exactly the kind of policy support that can accelerate domestic SAF production and reduce reliance on imports,” he added. OXCCU is developing a low-cost power-to-liquid CO2 Fischer-Tropsch technology for SAF production.

To manage the contracts under the RCM on behalf of the UK government, the bill also includes plans to establish a dedicated counterparty entity – a company limited by shares and held by a government minister. This institutional framework provides the administrative backbone necessary for implementing the RCM effectively.

Funding for this counterparty will come from a levy, which is the bill’s key third component. This will be imposed on aviation fuel suppliers. This ensures that the cost is borne by the industry and not taxpayers. The bill also incorporates financial penalties for non-compliance, ensuring that all stakeholders participate in the transition to sustainable aviation.

The SAF Bill still has a long journey ahead of it. It must navigate multiple readings in both the House of Commons and House of Lords before receiving Royal Assent.

But the SAF Bill wasn’t the only measure announced by the UK government to support the SAF industry. In a complementary move, the UK government has announced an additional £400,000 investment to support the testing and qualification of SAF technologies. UK-based companies like OXCCU can benefit from this support and spur innovation in technologies for SAF production.

It really has been an exciting week. Even if the documents try very hard to hide this.