The U.K. government has opened a public comment period as part of its effort to avoid market manipulation caused by overlapping domestic and international incentives for sustainable aviation fuel (SAF) and other low carbon fuels. 

The U.K. in July 2022 confirmed its intention to introduce a SAF mandate, starting in 2025. The scheme, based on the country’s renewable transport fuel obligation (RTFO), aims to incentive the supply of low carbon fuels for aviation. 

The U.K. Department of Transport (DfT) explains that globally traded nature of low carbon fuel and the support available in different countries means that it is possible that renewable fuels or their chemical precursors that could receive support under the existing RTFO, and forthcoming SAF mandate, could also receive support in their country of production. The DfT refers to this overlap as “multiple incentives.”

The government recognizes that the availability of multiple incentives has the potential to cause market distortion and negatively impact domestic suppliers. As a result, the DfT is working to ensure a level playing field for these fuels by preventing fuels and chemical precursors from receiving more than one inventive, both domestically and internationally. 

The public consultation specifically aims to help determine how the DfT will address the issue of multiple incentives in the case of the RTFO and SAF mandate, including proposals to update existing rules related to this issue. “To prevent fuels and chemical precursors from receiving multiple incentives, amendments need to be made to our current approach to support domestic and international fuel under the RTFO, while ensuring the eligibility criteria remain proportionate and administrable,” the DfT said in a notice posted to its website. “Changes to the RTFO would also be replicated in the upcoming SAF mandate to ensure these two schemes operate consistently.”

The consultation document describes three primary options. The first option would extend current U.K./European Economic Area provisions to fuel that is supplied form the rest of the world, but remove reference to tax-related support form the RTFO’s decision of a support scheme. The second would extend current U.K./EEA provisions to fuel that is supplied from the rest of the world, which would prevent the claim of all forms of multiple incentives. The third option would align EEA treatment with current treatment for the rest of the world, permitting the claim of multiple incentives. 

The public consultation period is opening through March 18. Additional information is available on the U.K. government website.