Alternative jet fuel

AN ACT Relating to providing certainty for the development of 1
low-to-zero carbon alternative jet fuel production in Washington 2
state; amending RCW 70A.535.150, 82.04.287, 82.04.436, 82.04.4361, 3
and 82.16.187; and creating a new section. 4
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:5
NEW SECTION. Sec. 1. (1) The legislature finds that:6
(a) Constructing alternative jet fuel production facilities 7
requires significant capital investment and long development 8
timelines; 9
(b) Encouraging and supporting the production and use of 10
alternative jet fuel, also known as sustainable aviation fuel, 11
supports the achievement of the state's emissions limits and the 12
goals of state climate policies such as the clean fuels program, 13
climate commitment act, and clean energy transformation act by taking 14
advantage of our legacy and new renewable resources and providing 15
certainty in accessing the available economic incentives targeted to 16
reduce the carbon intensity of aviation fuel; and 17
(c) The terms "alternative jet fuel," "sustainable aviation 18
fuel," "production," and "manufacturing" are used in various statutes 19
with similar meanings for defining the production and end use of low 20
carbon, nonfossil fuel-based jet fuel. This finding is not intended 21
S-3671.1
SENATE BILL 5932
State of Washington 69th Legislature 2026 Regular Session
By Senators Warnick, Dozier, and Shewmake
Prefiled 12/23/25. Read first time 01/12/26. Referred to Committee
on Environment, Energy & Technology.
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to alter the definitions of these terms as used in those statutes, 1
but rather to encourage similar interpretation of these terms when 2
encountered in statute or rule. 3
(2) Therefore, the legislature intends to: 4
(a) Encourage the production and use of alternative jet fuel in 5
the state; and 6
(b) Provide clarity and a date certain for the availability of 7
existing production tax incentives. Given the long lead times 8
required for feasibility, permitting, and construction that precede 9
fuel production and commercial use, providing a date certain to the 10
availability of existing alternative jet fuel production tax credits 11
will lower barriers for, and reduce the risk to, early capital 12
investment decisions, thereby enabling and accelerating the 13
production and use of alternative jet fuel in the state.14
(3) The legislature further intends that the carbon intensity and 15
renewable attributes of the energy purchased for alternative jet fuel 16
production processes is assigned those attributes reported in the 17
tariff, rate schedule, power purchase agreement, or utility-specific 18
contract or that utility's fuel mix disclosure report under which the 19
energy was purchased, and attributed for all processes using that 20
energy in the alternative jet fuel production process.21
Sec. 2. RCW 70A.535.150 and 2023 c 232 s 3 are each amended to 22
read as follows: 23
(1) By no later than December 31, 2023, the department must allow 24
one or more carbon intensity pathways for alternative jet fuel.25
(2) The department must allow biomethane to be claimed as the 26
feedstock for renewable diesel and alternative jet fuel consistent 27
with that allowable for compressed natural gas, liquefied natural 28
gas, liquefied compressed natural gas, or hydrogen production. The 29
department must include in the report required by RCW 70A.535.090(1) 30
information that includes the amount, generation date, and geographic 31
origin of renewable thermal certificates representing the biomethane 32
environmental attributes claimed by each reporting entity for the 33
fuels described in this subsection. 34
(3) The department must notify the department of revenue within 35
30 days when one or more facilities capable of producing a cumulative 36
production capacity of at least 20,000,000 gallons of alternative jet 37
fuel each year are operating in this state. 38
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(4)(a) Beginning for purposes of program year 2026 through 2037, 1
and, after 2037 for all electricity compliant with chapter 19.405 2
RCW, the department must apply a carbon intensity for electricity 3
that is supplied to an alternative jet fuel manufacturing facility as 4
follows:5
(i) The carbon intensity is as provided for the electricity 6
supplied in the rate schedule, tariff, power purchase agreement, or 7
utility-specific contract according to the fuel mix reported in the 8
rate schedule, tariff, power purchase agreement, or utility-specific 9
carbon intensity pursuant to the utility contract or fuel mix 10
disclosure statement;11
(ii) The carbon intensity is calculated pursuant to WAC 12
173-424-630(6), as it existed on January 1, 2026; and13
(iii) The specific carbon intensity is applicable to all 14
production processes of the alternative jet fuel manufacturing 15
facility including, but not limited to, the electrolysis of water and 16
carbon dioxide, involved in manufacturing or producing alternative 17
jet fuel and any coproducts including, but not limited to, renewable 18
naphtha, in that facility.19
(b) The specific carbon intensity for electricity specified in 20
(a) of this subsection must apply regardless of:21
(i) When a renewable electricity product, or specific carbon 22
intensity electricity product, power purchase agreement, rate 23
schedule, or tariff was negotiated or contracted for;24
(ii) The date on which the renewable electricity generating 25
facility began operating; and26
(iii) The utility's main utility-specific carbon intensity of 27
electricity.28
(c) This subsection (4) supersedes the requirements of WAC 29
173-424-610(9), as it existed on January 1, 2026, as they are applied 30
to an alternative jet fuel manufacturing facility. The department 31
must update WAC 173-424-610 to conform with the requirements of this 32
section at the department's next otherwise planned update of chapter 33
173-424 WAC.34
Sec. 3. RCW 82.04.287 and 2023 c 232 s 9 are each amended to 35
read as follows: 36
(1) Upon every person engaging within the state in the business 37
of manufacturing alternative jet fuel; as to such persons, the amount 38
of the tax with respect to such business is, in the case of 39
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manufacturers, equal to the value of the product manufactured, or in 1
the case of processors for hire, equal to the gross income of the 2
business, multiplied by the rate of 0.275 percent. 3
(2) Upon every person engaging in making sales, at retail or 4
wholesale, of manufactured alternative jet fuel; as to such persons, 5
the amount of the tax with respect to such business is equal to the 6
gross proceeds of sales of the alternative jet fuel, multiplied by 7
the rate of 0.275 percent. 8
(3) For the purposes of this section, "alternative jet fuel" 9
means a fuel that can be blended and used with conventional petroleum 10
jet fuels without the need to modify aircraft engines and existing 11
fuel distribution infrastructure and that has lower greenhouse gas 12
emissions based on a full life-cycle analysis when compared to 13
conventional petroleum jet fuel for which it is capable as serving as 14
a substitute, as certified by the department of ecology using the 15
methods for determining the carbon intensity of fuels under chapter 16
70A.535 RCW. "Alternative jet fuel" includes jet fuels derived from 17
coprocessed feedstocks at a conventional petroleum refinery as 18
certified by the department of ecology using the methods for 19
determining the carbon intensity of fuels under chapter 70A.535 RCW.20
(4) A person reporting under the tax rate provided in this 21
section must file a complete annual tax performance report with the 22
department under RCW 82.32.534. 23
(5)(a) The tax rate under subsections (1) and (2) of this section 24
takes effect on the earlier of:25
(i) The first day of the first calendar quarter following the 26
month in which the department receives notice from the department of 27
ecology that there are one or more facilities operating in this state 28
with a cumulative production capacity of at least 20,000,000 gallons 29
of alternative jet fuel each year, as required in RCW 70A.535.150; or30
(ii) July 1, 2031. 31
(b) The tax rate expires nine calendar years after the close of 32
the calendar year in which the tax rate under subsections (1) and (2) 33
of this section takes effect. 34
Sec. 4. RCW 82.04.436 and 2023 c 232 s 10 are each amended to 35
read as follows: 36
(1)(a) Subject to the limits and provisions of this section, a 37
credit is allowed against the tax otherwise due under this chapter 38
for persons engaged in the manufacturing of alternative jet fuel.39
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(b) Except as provided in (c) of this subsection, the credit 1
under this section is equal to $1 for each gallon of alternative jet 2
fuel that has at least 50 percent less carbon dioxide equivalent 3
emissions than conventional petroleum jet fuel and is sold during the 4
prior calendar year by: 5
(i) A business that produces alternative jet fuel and is located 6
in a qualifying county; or 7
(ii) A business's designated alternative jet fuel blender that is 8
located in this state. 9
(c) The credit amount under (b) of this subsection must increase 10
by 2 cents for each additional one percent reduction in carbon 11
dioxide equivalent emissions beyond 50 percent, not to exceed $2 for 12
each gallon of alternative jet fuel. 13
(d) A person may not receive credit under both (b)(i) and (ii) of 14
this subsection. 15
(e) The credit under this section is calculated only on the 16
portion of jet fuel that is considered alternative jet fuel and does 17
not include conventional petroleum jet fuel when such fuels are 18
blended or otherwise used in a jet fuel mixture. 19
(f) A credit under this section may not be claimed until the 20
earlier of:21
(i) The date on which the department of ecology verifies that 22
there are one or more facilities operating in this state with 23
cumulative production capacity of at least 20,000,000 gallons of 24
alternative jet fuel each year and has provided such notice to the 25
department; or26
(ii) July 1, 2031. 27
(g) Contract pricing for sales of alternative jet fuel between a 28
person claiming the credit under this section and the final consumer 29
must reflect the per gallon credit under (b) and (c) of this 30
subsection. 31
(h) A credit under this section may not be claimed until the 32
department of ecology, in consultation with the department of 33
archaeology and historic preservation, verifies that the person 34
applying for the credit is not engaged in the manufacturing of 35
alternative jet fuel on the footprint of a structure listed with the 36
department of archaeology and historic preservation as a historic 37
cemetery or tribal burial grounds as per chapter 27.44 or 68.60 RCW. 38
If the department of ecology has not made a determination within 60 39
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days of the person requesting verification under this subsection, the 1
application is deemed to be verified. 2
(2) A person may not receive credit under this section for 3
amounts claimed as credits under RCW 82.04.4361 or chapter 82.16 RCW.4
(3) To claim a credit under this section a person must 5
electronically file with the department all returns, forms, and any 6
other information required by the department, in an electronic format 7
as provided or approved by the department. 8
(4) To claim a credit under this section, the person applying 9
must: 10
(a) Complete an application for the credit which must include:11
(i) The name, business address, and tax identification number of 12
the applicant; 13
(ii) Documentation of the total amount of alternative jet fuel 14
manufactured and sold in the prior calendar year; 15
(iii) Documentation sufficient for the department to verify that 16
the alternative jet fuel for which the credit is being claimed meets 17
the definition in RCW 82.04.287(3) and the carbon intensity reduction 18
benchmarks under subsection (1)(b) and (c) of this section, as 19
certified by the department of ecology under chapter 70A.535 RCW;20
(iv) Documentation sufficient to verify compliance with 21
subsection (1)(g) of this section; and 22
(v) Any other information deemed necessary by the department to 23
support administration or reporting of the program.24
(b) Obtain a carbon intensity score from the department of 25
ecology prior to submitting an application to the department.26
(5) The department must notify applicants of credit approval or 27
denial within 60 days of receipt of a final application and 28
documentation. 29
(6) If a person fails to supply the information as required in 30
subsection (4) of this section, the department must deny the 31
application. 32
(7)(a) The credit under this section may only be claimed against 33
taxes due under RCW 82.04.287, less any taxable amount for which a 34
credit is allowed under RCW 82.04.440. 35
(b) A credit earned during one calendar year may be carried over 36
and claimed against taxes incurred for the next subsequent calendar 37
year but may not be carried over for any calendar year thereafter.38
(c) No refunds may be granted for credits under this section.39
(8) For the purposes of this section: 40
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(a) "Alternative jet fuel" has the same meaning as in RCW 1
70A.535.010. 2
(b) "Carbon dioxide equivalent" has the same meaning as in RCW 3
70A.45.010. 4
(c) "Qualifying county" means a county that has a population less 5
than 650,000 at the time an application for a credit under this 6
section is received by the department. 7
(9)(a) Credits may be earned beginning on the earlier of:8
(i) The first day of the first calendar quarter following the 9
month in which notice under subsection (1)(f) of this section was 10
received by the department; or11
(ii) July 1, 2031. 12
(b) Credits may not be earned beginning nine calendar years after 13
the close of the calendar year in which the credit may be earned, as 14
provided in (a) of this subsection. 15
(10) A person claiming the credit provided in this section must 16
file a complete annual tax performance report with the department 17
under RCW 82.32.534. 18
Sec. 5. RCW 82.04.4361 and 2023 c 232 s 11 are each amended to 19
read as follows: 20
(1)(a) Subject to the limits and provisions of this section, a 21
credit is allowed against the tax otherwise due under this chapter 22
for persons engaged in the use of alternative jet fuel.23
(b) Except as provided in (c) of this subsection, the credit 24
under this section is equal to $1 for each gallon of alternative jet 25
fuel that has at least 50 percent less carbon dioxide equivalent 26
emissions than conventional petroleum jet fuel and is purchased 27
during the prior calendar year by a business for use as alternative 28
jet fuel for flights departing in this state. 29
(c) The credit amount under (b) of this subsection must increase 30
by 2 cents for each additional one percent reduction in carbon 31
dioxide equivalent emissions beyond 50 percent, not to exceed $2 for 32
each gallon of alternative jet fuel. 33
(d) The credit under this section is calculated only on the 34
portion of jet fuel that is considered alternative jet fuel and does 35
not include conventional petroleum jet fuel when such fuels are 36
blended or otherwise used in a jet fuel mixture. 37
(e) A credit under this section may not be claimed until the 38
earlier of:39
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(i) The date on which the department of ecology verifies that 1
there are one or more facilities operating in this state with 2
cumulative production capacity of at least 20,000,000 gallons of 3
alternative jet fuel each year and has provided such notice to the 4
department; or5
(ii) July 1, 2031. 6
(2) A person may not receive credit under this section for 7
amounts claimed as credits under RCW 82.04.436 or chapter 82.16 RCW.8
(3) To claim a credit under this section a person must 9
electronically file with the department all returns, forms, and any 10
other information required by the department, in an electronic format 11
as provided or approved by the department. 12
(4) To claim a credit under this section, the person applying 13
must: 14
(a) Complete an application for the credit which must include:15
(i) The name, business address, and tax identification number of 16
the applicant; 17
(ii) Documentation of the amount of alternative jet fuel 18
purchased by the business in the prior calendar year;19
(iii) Documentation sufficient for the department to verify that 20
the alternative jet fuel for which the credit is being claimed meets 21
the definition in RCW 82.04.287(3) and the carbon intensity reduction 22
benchmarks under subsection (1)(b) and (c) of this section, as 23
certified by the department of ecology under chapter 70A.535 RCW; and24
(iv) Any other information deemed necessary by the department to 25
support administration or reporting of the program.26
(b) Obtain a carbon intensity score from the department of 27
ecology prior to submitting an application to the department.28
(5) The department must notify applicants of credit approval or 29
denial within 60 days of receipt of a final application and 30
documentation. 31
(6) If a person fails to supply the information as required in 32
subsection (4) of this section, the department must deny the 33
application. 34
(7)(a) The credit under this section may be used against any tax 35
due under this chapter. 36
(b) A credit earned during one calendar year may be carried over 37
and claimed against taxes incurred for the next subsequent calendar 38
year but may not be carried over for any calendar year thereafter.39
(c) No refunds may be granted for credits under this section.40
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(8) For the purposes of this section: 1
(a) "Alternative jet fuel" has the same meaning as in RCW 2
70A.535.010. 3
(b) "Carbon dioxide equivalent" has the same meaning as in RCW 4
70A.45.010. 5
(9)(a) Credits may be earned beginning on the earlier of:6
(i) The first day of the first calendar quarter following the 7
month in which notice under subsection (1)(e) of this section was 8
received by the department; or9
(ii) July 1, 2031. 10
(b) Credits may not be earned beginning nine calendar years after 11
the close of the calendar year in which the credit may be earned, as 12
provided in (a) of this subsection. 13
(10) A person claiming the credit provided in this section must 14
file a complete annual tax performance report with the department 15
under RCW 82.32.534. 16
Sec. 6. RCW 82.16.187 and 2023 c 232 s 12 are each amended to 17
read as follows: 18
(1)(a) Subject to the limits and provisions of this section, a 19
credit is allowed against the tax otherwise due under this chapter 20
for persons engaged in the use of alternative jet fuel.21
(b) Except as provided in (c) of this subsection, the credit 22
under this section is equal to $1 for each gallon of alternative jet 23
fuel that has at least 50 percent less carbon dioxide equivalent 24
emissions than conventional petroleum jet fuel and is purchased 25
during the prior calendar year by a business for use as alternative 26
jet fuel for flights departing in this state. 27
(c) The credit amount under (b) of this subsection must increase 28
by 2 cents for each additional one percent reduction in carbon 29
dioxide equivalent emissions beyond 50 percent, not to exceed $2 for 30
each gallon of alternative jet fuel. 31
(d) The credit under this section is calculated only on the 32
portion of jet fuel that is considered alternative jet fuel and does 33
not include conventional petroleum jet fuel when such fuels are 34
blended or otherwise used in a jet fuel mixture. 35
(e) A credit under this section may not be claimed until the 36
earlier of:37
(i) The date on which the department of ecology verifies that 38
there are one or more facilities operating in this state with 39
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cumulative production capacity of at least 20,000,000 gallons of 1
alternative jet fuel each year and has provided such notice to the 2
department; or3
(ii) July 1, 2031. 4
(2) A person may not receive credit under this section for 5
amounts claimed as credits under chapter 82.04 RCW.6
(3) To claim a credit under this section a person must 7
electronically file with the department all returns, forms, and any 8
other information required by the department, in an electronic format 9
as provided or approved by the department. 10
(4) To claim a credit under this section, the person applying 11
must: 12
(a) Complete an application for the credit which must include:13
(i) The name, business address, and tax identification number of 14
the applicant; 15
(ii) Documentation of the amount of alternative jet fuel 16
purchased by the business in the prior calendar year;17
(iii) Documentation sufficient for the department to verify that 18
the alternative jet fuel for which the credit is being claimed meets 19
the definition in RCW 82.04.287(3) and the carbon intensity reduction 20
benchmarks under subsection (1)(b) and (c) of this section, as 21
certified by the department of ecology under chapter 70A.535 RCW; and22
(iv) Any other information deemed necessary by the department to 23
support administration or reporting of the program.24
(b) Obtain a carbon intensity score from the department of 25
ecology prior to submitting an application to the department.26
(5) The department must notify applicants of credit approval or 27
denial within 60 days of receipt of a final application and 28
documentation. 29
(6) If a person fails to supply the information as required in 30
subsection (4) of this section, the department must deny the 31
application. 32
(7)(a) The credit under this section may be used against any tax 33
due under this chapter. 34
(b) A credit earned during one calendar year may be carried over 35
and claimed against taxes incurred for the next subsequent calendar 36
year but may not be carried over for any calendar year thereafter.37
(c) No refunds may be granted for credits under this section.38
(8) The definitions in RCW 82.04.4361 apply to this section.39
(9)(a) Credits may be earned beginning on the earlier of:40
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(i) The first day of the first calendar quarter following the 1
month in which notice under subsection (1)(e) of this section was 2
received by the department; or3
(ii) July 1, 2031. 4
(b) Credits may not be earned beginning nine calendar years after 5
the close of the calendar year in which the credit may be earned, as 6
provided in (a) of this subsection. 7
(10) A person claiming the credit provided in this section must 8
file a complete annual tax performance report with the department 9
under RCW 82.32.534. 10
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