The $1-per-gallon tax credit on biodiesel fuel, a clean-burning renewable substitute for petroleum diesel, would be extended through 2020 under bipartisan legislation recently introduced by U.S. Rep. Kristi Noem (R-SD).
The American Renewable Fuel and Job Creation Act would also reform the biodiesel tax credit to clarify that the credit only applies to fuel produced in the United States.
“Turning corn and soybeans into fuel not only opens the door for better ag prices and greater market stability, but also offers broader benefits for our national economy and security,” Noem said. “Continuing this innovative technology is essential. This legislation would give more certainty regarding biodiesel’s availability while ensuring the incentive is encouraging American biodiesel production, not the importation of foreign biodiesel — a move consistent with our goal of achieving American energy independence.”
Speaking in support of the bill, Jerry Schmitz, the president of the South Dakota Soybean Association, said biodiesel represents a cleaner fuel alternative and plays a critical role in U.S. energy independence.
“By extending the biodiesel tax credit and changing the blender’s credit to a producer’s credit, we can level the playing field with foreign importers and ensure that tax dollars support American industries,” Schmitz said.
Anne Steckel, the vice president of federal affairs at the National Biodiesel Board, said her organization was thrilled to see momentum building in both chambers of Congress for Noem’s tax reform and extension bill.
“It is long overdue to close this loophole and better align the incentive with Congress’ intent — to invest American taxpayer dollars to spur job creation here at home,” Steckel said.
U.S. Reps. Bill Pascrell (D-NJ) and Dave Loebsack (D-IA) cosponsored the bill.