Heavy traffic moves along Interstate-395 on Nov. 22, 2022, in Washington, D.C. (Photo by Drew Angerer/Getty Images)

The U.S. Environmental Protection Agency has submitted a proposal to scrap a years-old finding that greenhouse gas emissions threaten the environment and public health, a move that former agency officials say would gut the EPA’s authority to reduce emissions and is sure to end up in the courts.

The EPA sent a draft proposal to the White House late last month calling for scrapping what’s referred to as the endangerment finding on top of vehicle emissions standards for certain cars and trucks. The White House Office of Management and Budget could finish reviewing the draft on Monday and some expect an announcement on the issue the last week of July, Joe Goffman, a former assistant administrator for the EPA’s Office of Air and Radiation, said in an interview.

Former EPA officials say such a move would gut the agency’s own power to curb greenhouse gas emissions, which have been widely found to cause global warming.

“It’ll be the most decisive step taken to make the agency totally irrelevant, which then will become an excuse to just get rid of it,” Christine Todd Whitman, the EPA administrator from 2001 to 2003 under President George W. Bush, said in a phone interview.

Whitman said she thinks “the long-term goal of all of this is to ensure that the agency can’t do regulations.”

‘Suffocating its own authority’

The EPA finalized what it is known as the endangerment finding in late 2009. It said that greenhouse gases are a threat to both the environment and public health and that emissions from vehicles pollute the air with greenhouse gases. The finding is what obligates the EPA to address greenhouse gas emissions, Goffman said.

“Essentially what the EPA is doing is suffocating its own authority under the Clean Air Act…to establish programs and rules to reduce greenhouse gas emissions,” said Goffman, who worked at the EPA during the administrations of Democratic Presidents Joe Biden and Barack Obama.

“They’re making it impossible to take steps to reduce greenhouse gas emissions” in a deliberate fashion, he said.

EPA Administrator Lee Zeldin announced back in March that the agency was going to reconsider the finding.

Its proposal — which was submitted to the executive branch’s Office of Management and Budget on June 30 — will be shared for public comment following interagency review and after Zeldin has signed it, an EPA spokesperson said Thursday in an email.

The White House didn’t respond to a request for comment.

Court fight ahead

The Trump administration’s moves to scrap the finding and vehicle emissions standards are its latest plays to dial back U.S. climate policy and efforts to fight climate change.

President Donald Trump and congressional Republicans scaled back support for renewable energy projects and other climate policies in the budget reconciliation bill signed into law July 4.

Trump also signed executive orders during his first days back in office to pull the U.S. out of the Paris climate agreement again and to aid fossil fuel production.

The EPA said the endangerment finding went beyond the agency’s statutory authority under the Clean Air Act, according to a summary of part of the proposal that was sent to the White House.

The Clean Air Act “does not authorize the EPA to prescribe emission standards to address global climate change concerns,” an executive summary of the proposal sent to the White House states, according to an excerpt obtained by States Newsroom.

Because of that, the agency is proposing rescinding “the Administrator’s findings that GHG emissions from new motor vehicles and engines contribute to air pollution which may endanger public health or welfare,” it said.

The agency in its proposal also raises a key 2007 U.S. Supreme Court decision in the case of Massachusetts v. EPA that determined the EPA is allowed to regulate greenhouse gases as part of the Clean Air Act because they pollute the air.

The EPA argued that the decision doesn’t support how the agency has carried out the Clean Air Act. On top of that, the agency says that the “EPA unreasonably analyzed the scientific record” and that “developments cast significant doubt on the reliability of the findings.”

Similar to numerous other executive actions taken by the Trump administration, Whitman and Goffman said they expect this latest move will end up in the courts.

“This is the beginning of a long, long saga,” Goffman said.

A worker walks beneath a United Airlines Boeing 737-900ER after it arrived at Los Angeles International Airport (LAX) on June 5, 2019. The flight from Chicago to Los Angeles used aviation biofuel, a critical component of airlines’ goal of reaching a net-zero carbon goal by 2050. (Photo by Mario Tama/Getty Images)

Congress’ passage of President Donald Trump’s spending and tax cuts bill this month could help grow the market for sustainable aviation fuel, a nascent industry that could be a boon for corn-producing states as airline operators are betting on it to decarbonize the sector.

The Republican budget reconciliation law that Trump signed July 4 pared back some of the credits for sustainable energy in the law that congressional Democrats passed and President Joe Biden signed in 2022 — the Inflation Reduction Act.

But the recent law extended one energy tax credit for producing clean fuels, such as sustainable aviation fuel, an alternative to the typical jet fuel planes use. The credit initially went through 2027, but the GOP law extends it through 2029.

Advocates for sustainable aviation fuel had been pushing Congress to extend the tax credit to support production as states across the U.S. have passed or proposed their own tax credits to grow the sector and lure production within their borders. Lawmakers in Iowa, Wisconsin, Michigan and New York have introduced bills enacting tax credits for sustainable aviation fuel.

For airlines, increasing availability of the fuel is essential for the sector to meet its net-zero goal for 2050, with the International Air Transport Association estimating the cleaner fuel could get the industry 65% of the way toward its target.

“We’re not yet at commercial-scale production and you need that longer lead time for these types of projects so I think the extension is really key,” said Chris Bliley, senior vice president of regulatory affairs at Growth Energy, a biofuel industry group.

While the credit’s lifetime was extended, others say the environment for sustainable aviation fuel isn’t as favorable as it was just a few years ago. The new budget reconciliation law also included provisions to lower the credit amount for sustainable aviation fuel specifically and clawed back unobligated grant funding to support the sector.

The amount of sustainable aviation fuel that producers make today is far from how much the airline industry needs to be able to use the alternative fuel regularly. U.S. production capacity over the last couple of years, however, has grown, jumping from less than 5,000 barrels per day at the start of 2024 to more than 30,000 by February of this year, according to a May report from the U.S. Energy Information Administration.

Badger State bill

Wisconsin state Rep. David Steffen, a Republican who sponsored a bill to incentivize sustainable aviation fuel, said he learned about a sustainable aviation fuel production company based in Madison called Virent Inc., now a subsidiary of Marathon Petroleum Corp. Virent’s fuel helped power the first domestic flight powered by 100% sustainable aviation fuel in one of its engines.

“I was intrigued that we had this company in our state and I want them and other companies of similar interest to find Wisconsin as their new home,” Steffen said. “It’s a great opportunity for not only the environmental benefits that come with it but for our farmers, dairies and timber producers to access a brand-new market for their product.”

Steffen’s bill also requires that to receive the tax credit, source materials for the fuel must be domestically sourced.

Wisconsin’s legislative session doesn’t end until next March and Steffen said he’s “very comfortable in saying (the bill) will have a clear path to the finish line.” Should it pass in its current state, the tax credit would go into effect in 2028.

Other states

Iowa, Illinois, Minnesota, Nebraska and Washington state all already have enacted laws to provide tax credits for sustainable aviation fuel.

Lawmakers in New York and Michigan have also proposed legislation to create their own tax credits. The New York bill barely moved in the most recent session, while legislation in Michigan has made it out of one committee and been referred to a second.

New York state Sen. Rachel May, a Democrat, plans to re-introduce the legislation next year. She said she wants to amend her bill to offer a larger tax credit for companies making sustainable aviation fuel specifically by mimicking photosynthesis so it doesn’t incentivize diverting feedstock like corn from being used for food, she said.

Her concern is moving the agriculture industry “away from both food production and maybe what might be the best uses of the land,” she added.

Corn ethanol, a common ingredient in automotive fuel, can be used to make sustainable aviation fuel.

Federal extension

While the extension of the federal clean fuels tax credit could be beneficial to the sustainable aviation fuel industry, the new law also lowers the amount of the tax credit for the fuel. It’s now the equivalent to what other biofuel producers qualify for, giving sustainable aviation fuel production less of a competitive advantage.

One version of the budget reconciliation bill also called for extending the tax credit by four years instead of two, but that got scaled back in the version of the bill ultimately signed into law.

The new law also took away any funding not yet obligated as part of a grant program for sustainable aviation fuel and makes fuels derived from feedstocks that come from outside the U.S., Canada or Mexico ineligible for the tax credit.

Despite any limitations, some analysts expect the law will still boost sustainable aviation fuel.

“The Trump administration has yet to outline its approach to SAF, but we expect the fuel to benefit from the administration’s focus on supporting biofuel-producing states,” analysts for Capstone DC, a firm that advises business clients on policy issues, said in a note in late June.

But changes to the federal tax credit could also make states more interested in adopting their own credit to support sustainable aviation fuel, Capstone added.

‘Not nearly as strong’

Tariffs, meanwhile, could also make U.S. feedstocks for producing the fuel more competitive, Paul Greenough, a vice president on Capstone’s energy team.

But Greenough cautioned that sentiment around sustainable aviation fuel still isn’t as rosy as it used to be.

“Momentum still exists for SAF but it’s not nearly as strong as it was under the Biden administration,” he said.

Some climate groups have also expressed concern over changing the clean fuels tax credit at the federal level. The Clean Air Task Force, ahead of the bill becoming law, said extending the credit will largely service other fuels that aren’t sustainable aviation fuel, which will in turn be costlier for the government.

“This purported attempt to incentivize ‘clean fuels’ is little more than a giveaway to the conventional biofuels industry,” the organization said in a post on its website.