Ethanol Blog

Biodiesel Credit Extension Sought, RFS Defense Continues

Todd Neeley
By  Todd Neeley , DTN Staff Reporter
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The biodiesel industry along with 51 other industries are asking Congress to take one more shot at passing an extension of the $1 biodiesel blenders tax credit ahead of the November elections, as time is running out on the current session.

In a letter to leaders in the House and Senate Tuesday, the organizations say the industry needs a multi-year extension.

“The undersigned organizations, representing a variety of business, energy, transportation and agriculture stakeholders, strongly urge Congress to provide a seamless, multi-year extension of the tax provisions that are currently slated to expire at the end of 2016,” the letter said.

“These tax provisions impact sectors that are vital to the U.S. economy and support thousands of jobs nationwide. Allowing these tax provisions to lapse would effectively increase taxes on the entities that create jobs and economic growth. Also, the on-again, off-again nature of credit eligibility will cause uncertainty and make it more difficult for businesses to make important tax planning decisions.

The National Biodiesel Board’s Vice President of Federal Affairs Anne Steckel said the credit’s pending expiration on Dec. 31 has made life difficult for producers.

“It is incredibly disruptive to have this looming expiration hanging over the industry year after year,” she said.

“If Congress doesn’t act soon, it would mark the fifth time in eight years that Congress has allowed the biodiesel incentive to expire while at the same time tax breaks for oil and gas production are written permanently in the tax code. We could be seeing tremendous growth and hiring in this industry but instead biodiesel producers will be sitting on the sidelines waiting to see what happens. So it’s time for Congress to come together and pass an extenders package before these incentives expire at the end of the year.”

The letter is signed by a number of biofuels and farm groups including: Advanced Biofuels Business Council; Algae Biomass Organization; American Biogas Council; American Gas Association; American Farm Bureau Federation; American Council on Renewable Energy; National Biodiesel Board; National Council of Farmer Cooperatives; American Sheep Industry Association; American Soybean Association

Biotechnology Innovation Organization; Farm Credit Council; National Milk Producers Federation and others.

Also on Tuesday, the Renewable Fuels Association launched paid advertising in The Hill, Politico and Morning Consult, entitled, “Don’t Fall for the Blend Wall” to push back against legislation offered to reform the Renewable Fuel Standard.

The American Petroleum Institute has put its full support behind a bill introduced by U.S. Reps. Bill Flores, R-Texas, and Peter Welch, D-Vt., to limit the amount of ethanol blended in gasoline at 9.7% of gasoline.

“Big Oil’s ‘blend wall’ myth claims that the U.S. fuel supply cannot contain more than 10 percent biofuel,” the ad reads. “But that myth crumbled years ago, as more and more consumers have filled up on higher ethanol blends like E15 and E85.”

The advertisement says ethanol makes up more than 10% of the fuel blend in 22 states.

Todd Neeley can be reached at todd.neeley@dtn.com

Follow him on Twitter @toddneeleyDTN

(TN)

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