Senate backs aviation fuel incentive to spur Utah refining, caps program at $10 million

The Utah Senate approved a substituted version of Senate Bill 284 that creates a jet-fuel incentive program intended to encourage refining and sale of aviation fuel in Utah rather than importing it.

Sponsor Senator Colmore (presenting) described a regional jet-fuel shortage and said the substitute shifts program administration from GOED to the inland port. The substitute sets a program cap of up to $1,000,000 per year and up to $10,000,000 over the program’s 15-year life. It requires participating refineries and airlines to meet baseline production thresholds and investment ratios (for example, a 3:1 private investment-to-incentive ratio and minimum annual production requirements).

The sponsor said incentives would come from incremental severance and fuel taxes generated from increased in-state refining and that the inland port would oversee qualification and performance comparisons against a base-year production level. Senators asked whether increasing jet-fuel refining would reduce gasoline supply; the sponsor responded that different refining streams are involved and did not expect an impact on vehicle gasoline supply.

The substituted bill passed under suspension of the rules and will be sent to the House for consideration.