Nearly three dozen biodiesel leaders from Kansas to Rhode Island took to the halls of Congress this week to champion America’s Advanced Biofuel.
“We have a great message to share with our elected officials. Biodiesel is working today to support jobs, diversify our fuel options and support American energy security,” said National Biodiesel Board (NBB) CEO, Donnell Rehagen. “We want our messages and our success story to be top of mind now and when any tax extenders or reform is considered.”
The U.S. market has grown by nearly 2 billion gallons in the last 10 years, bringing with it support for nearly 48,000 jobs and $1.9 billion in wages across the country.
“We want to do all we can to ensure our elected leaders know the decisions they make in D.C. make a difference in our back yards and our communities across the nation. Effective federal policy has helped level the playing field for our relatively new product. This is about so much more than a standard or tax code. It’s about real people, making a real difference to bring jobs and economic growth, all while supporting clean air and renewable fuel options,” Rehagen explained.
The group was specifically championing a call to extend the biodiesel tax incentive and move it from a blender’s tax credit to a producer’s tax credit. The current blender’s credit is slated to expire December 31, 2016. Proposed legislation in the House and Senate (HR 5240, S 3188) has strong bipartisan support and would adjust the credit to support domestic production over imports.
U.S. biodiesel producers have more than 1.5 billion gallons of unused production capacity that stands ready to be utilized under the right policy framework. Mobilizing that capacity would create thousands of jobs and billions of dollars in economic activity.
Under the current “blender’s” structure of the incentive, foreign biodiesel imported to the U.S. and blended with petroleum diesel in the U.S. is eligible for the tax incentive. Increasingly, foreign biodiesel producers are taking advantage of the U.S. incentive by shipping their product here. In 2015 alone, some 670 million gallons of biodiesel and renewable diesel were imported to the U.S., making up nearly a third of the U.S. market.