Biodiesel tax credit extension bills have been introduced in both the House and Senate. The bills call for a 3-year extension of the biodiesel tax credit through 2014. A multi-year extension, which ASA has strongly advocated, is necessary to provide stability and certainty to the still maturing biodiesel industry. The current biodiesel tax incentive expires on Dec. 31, 2011.
The House bill, H.R. 2238, was introduced by Illinois Representative Aaron Schock and Minnesota Representative Collin Peterson. The Senate bill, S. 1277, was introduced by Washington Senator Maria Cantwell and Iowa Senator Chuck Grassley.
The American Soybean Association (ASA) appluaded the action of these introductions in both the House and Senate.
“ASA applauds Representatives Schock and Peterson, and Senators Cantwell and Grassley, and all of the cosponsors of the bill for their leadership and support,” said ASA First Vice President Steve Wellman, a soybean producer from Syracuse, Neb. “ASA, along with soybean farmers, state soybean associations, and the biodiesel industry, has been working to enlist additional cosponsors and supporters.”
Biodiesel is a renewable, clean-burning diesel replacement that is reducing U.S. dependence on foreign petroleum, creating green jobs and improving our environment. Biodiesel is the first and currently the only commercially available fuel that qualifies as an advanced biofuel. Its production, distribution and use will support more than 31,000 U.S. jobs in 2011 and replace nearly 1 billion gallons of imported petroleum diesel. Biodiesel is used in existing diesel engines and meets strict specifications of ASTM D6751.
“In addition to providing a multi-year extension, the bills would also shift the credit from a blender’s credit to a production tax credit,” Wellman said. “This shift would improve efficiency in the administration of the credit and reduce opportunities for fraud and abuse.”
ASA recognizes the challenges that exist to achieving an extension of the biodiesel tax credit in light of the current focus on cutting government expenditures. ASA strongly supports enactment of a comprehensive plan to put our country on a path to fiscal stability.
However, continued support for biodiesel can assist in these efforts due to the economic and energy security benefits that it provides. Biodiesel production adds several billion dollars to the nation’s Gross Domestic Product (GDP) and generates hundreds of millions in tax revenue for federal, state and local governments.
“ASA wants to ensure that biodiesel is in position to be included in any energy and/or tax policy measures that are developed by Congress,” Wellman said. “Passage of an extension of the biodiesel tax credit provides the biodiesel industry an opportunity to grow and meet our nation’s demand for cleaner-burning, homegrown renewable fuel.”