Oct 16 (Reuters) - The U.S. Department of Energy said on

Wednesday it has approved conditional loan guarantee commitments

totaling nearly $3 billion for two sustainable aviation fuel

projects.

The agency's Loan Programs Office said the funding of up to

$1.44 billion to Calumet's unit would support the

expansion of its facility in Montana.

The facility will utilize vegetable oils, fats, and greases

to produce SAF, renewable diesel, and renewable naphtha.

If finalized, the loan guarantee would fund facility

expansion to produce about 315 million gallons per year of

biofuels, most of which will be SAF, the agency said.

The White House aims to meet all of the U.S.'s aviation fuel

demand with SAF by 2050 and to supply at least 3 billion gallons

of SAF annually by 2030.

Once the Montana facility reaches full capacity, its output

would represent 10% of the SAF Grand Challenge goal of 3 billion

gallons annually by 2030, DOE said.

The government body also approved an up to $1.46 billion

loan guarantee to renewable fuels company Gevo ( GEVO ) to help

finance a corn starch-to-jet fuel facility in Lake Preston,

South Dakota.

Gevo ( GEVO ) would be the first integrated, commercial-scale

facility in the United States to convert corn starch to SAF with

carbon capture and renewable power, DOE said.

The U.S. Energy Information Administration expects domestic

production of biofuels to increase by about 50% in 2024, led by

rising SAF production.