The government called for incentivising the development of sustainable jet fuel

Ireland should give tax breaks to the development of new sustainable fuel technologies as part of the sector’s effort to reduce its carbon emissions, according to auditing and services group PwC.

As part of the pre-budget climate action bill, the company says the government should also expand the accelerated capital allowance scheme to apply to energy-efficient and sustainable fuel aircraft.

The global aviation sector is responsible for about 2 percent of global carbon emissions. There is a push to run more planes on so-called sustainable aviation fuel (SAF), made from raw materials such as used cooling oil, forestry and agricultural waste. It is combined with regular jet fuel.

The European Union has mandated that jet fuel delivered to European airports must contain 2 percent SAF by 2025, increasing every five years to 63 percent by 2050.

“As the world’s leading center for aircraft leasing and home to Europe’s largest airline, Ireland has the opportunity to play a leading role in the aviation industry’s journey to net zero,” reads PwC’s submission released today.

The pre-budget document lists a number of actions it believes the government should take to help tackle climate change.

“Tax policy is a key lever at the Government’s disposal in our fight against climate change,” said Peter Reilly, Head of Tax Policy at PwC Ireland.

“From providing tax incentives to encouraging investment in specific areas, or levying taxes to discourage certain behaviors and fund a just transition for all, positive change can be made across society and the economy.

“While the impact of Covid-19 and the war in Ukraine have created unprecedented challenges, given the impact of climate change on humanity, it must remain high on the agenda,” added Mr. Reilly.

PwC has called for a range of measures, including capital grants to improve port infrastructure, as companies take advantage of Ireland’s offshore wind energy potential.

It also says that improved R&D tax credits should be available to support green innovation and climate technology development, and that Ireland should be put on track to become a leading center for sustainable finance by 2025. The government called for incentivising the development of sustainable jet fuel

Fry Electronics Team

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