DTN Ag Policy Blog

Ag, Biofuel Reaction to Inflation Reduction Act

Chris Clayton
By  Chris Clayton , DTN Ag Policy Editor
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Biofuels get a boost in the Inflation Reduction Act with $500 million to build out more blender pumps and other infrastructure. Tax credits for biodiesel and renewable diesel are extended, as well as sustainable aviation fuel. A new tax credit is created for clean fuel production as well. (DTN file photo)

Addressing the passage of the Inflation Reduction Act (IRA), Agriculture Secretary Tom Vilsack said Friday the legislation "will provide significant support for farmers, ranchers, and forest landowners as they care for our precious land, adapt and mitigate to climate change and ensure America remains a food secure nation."

Vilsack already has trips planned early this coming week to Michigan and Colorado where he will tout the provisions in the IRA dealing with agriculture and renewable energy. The White House also has scheduled multiple briefings on various provisions in the bill as well.

"With historic investments in a clean energy economy, the Inflation Reduction Act will create good-paying jobs and more economic opportunity in rural communities across the country," Vilsack said.

The secretary added, "The law is a once-in-a-generation opportunity to build critical infrastructure, to protect communities from wildfire and extreme heat and to drive climate-smart agriculture and renewable energy initiatives nationwide."


National Council of Farmer Cooperatives President and CEO Chuck Conner said, "The increased funding to support climate-smart agriculture included in the Inflation Reduction Act that passed the House of Representatives today represents a recognition by policymakers of the important role that America's farmers, ranchers and growers can play in addressing the issue of climate change."

"It is especially important that the funding is targeted at voluntary, working-lands conservation programs that have a long, proven track record of success. We look forward to working with the House and Senate agriculture committees as they begin writing a new farm bill next year to ensure that this funding is utilized as effectively as possible to promote climate-smart farming practices."

Rob Larew, president of the Democratic-leaning National Farmers Union, said, "The passage of the Inflation Reduction Act is cause for optimism for farmers and ranchers across the country, with historic investments in voluntary, incentive-based conservation programs that are critically underfunded."

"NFU is proud to see investment in biofuels infrastructure that will help farmers' bottom line and help consumers save at the pump. The inclusion of financial support for economically distressed farmers and ranchers is also a welcome addition that will help keep farmers on their land for years to come."


Renewable Fuels Association President and CEO Geoff Cooper said, "When it comes to ethanol and other renewable fuels, this bill represents the most significant federal commitment to low-carbon biofuels since the Renewable Fuel Standard was expanded by Congress in 2007."

"We look forward to these provisions becoming law quickly so that American families have greater access to lower-cost, American-made renewable fuels that are good for the environment, the economy, and energy security."

Clean Fuels Alliance America thanked House leaders for extending the biodiesel and renewable diesel incentive and creating a new infrastructure grant program in the IRA The legislation will extend existing industry tax incentives and create a sustainable aviation fuel tax incentive through 2024. It also creates a new Clean Fuel Production Credit for 2025, 2026 and 2027 and a new Biofuel Infrastructure and Agriculture Product Market Expansion, with funding through September 2031.

"Cleaner, better fuels like biodiesel and renewable diesel are essential to America's economy and environment. They support good-paying jobs, reduce fuel prices and the cost of transporting consumer goods, and cut carbon emissions by an average 74%," stated Clean Fuels' Vice President of Federal Affairs Kurt Kovarik.

The American Biogas Council (ABC) cited that "Congress has recognized the essential role biogas systems, which recycle organic waste into renewable energy and domestic, natural fertilizer products, play in our society. With only two ways to recycle the billions of tons of organic waste the U.S. produces every year, biogas systems and compost systems, we can't accelerate construction of this essential infrastructure fast enough. The IRA will help us push the pedal down."

While the U.S. has about 2,300 biogas systems, ABC stated the bill will help drive a greater focus on more biogas production from food waste as well as manure from cattle, chickens, turkey and hogs, as well as wastewater.

"For the first time, the system of tax credits in the bill supports all biogas sectors: wastewater, farm, food waste, and projects that produce renewable electricity, renewable natural gas, and renewable heat. Plus, the additional $1.965 billion to support the existing Rural Energy for America Program (REAP) will help our industry work with agriculture to increase sustainability and productivity," ABC stated

See specific details on the legislation, "House Passes Inflation Reduction Act," https://www.dtnpf.com/…

Chris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN

Chris Clayton