NATSO, SIGMA Urge Congress to Extend $1/Gallon Biodiesel Credit
- 12-Nov-2024 1:30 AM
- Journalist: Peter Schmidt
NATSO, representing truck stops and travel centers, and SIGMA, a leading association for America’s fuel marketers, are calling on Congress to extend a series of expiring tax credits, including the $1 per gallon biodiesel blenders’ tax credit, during the upcoming Lame Duck session. Together, these associations represent nearly 80% of retail fuel sales and believe extending this credit is essential for supporting the fuel market, maintaining lower prices, and reducing carbon emissions. They expressed gratitude for Senator Chuck Grassley’s recent public support for including the biodiesel tax credit in a tax package he insists "must be passed." Additionally, they acknowledged the bipartisan efforts of Representatives Mike Carey, Annie Kuster, and Claudia Tenney, who introduced H.R. 9060, a bill to extend the biodiesel blenders’ credit for an additional year.
David Fialkov, NATSO and SIGMA’s Executive Vice President of Government Affairs, highlighted the associations’ intent to engage with Congress on policies to stabilize the fuel market, keep fuel costs low, and support carbon reduction in transportation. "Fuel retailers are prepared to work with Congress as it addresses critical priorities in the Lame Duck Session," Fialkov stated.
While the Inflation Reduction Act introduced a new Clean Fuel Production tax credit, known as "45Z," there has been little guidance from the Biden Administration on how this credit will apply to various fuels. This uncertainty, coupled with the pending expiration of the biodiesel credit at the end of 2024, is causing challenges for biodiesel producers, fuel retailers, trucking companies, and related industries, including those in the soy sector.
A wide range of stakeholders supports H.R. 9060, including the American Trucking Associations, Energy Marketers of America, and several soybean grower associations from states like Illinois, Iowa, and Kentucky, as well as organizations like the National Association of Convenience Stores and the Truckload Carriers Association.
Historically, biodiesel and renewable diesel have been the primary biofuels in commercial trucking and are key for reducing carbon emissions in the trucking, home heating oil, and rail industries. The biodiesel tax credit helps lower diesel costs for truck drivers, which in turn decreases shipping expenses, benefiting consumers by reducing prices on goods transported by truck.
An extension of the tax credit would allow motor carriers to continue reducing emissions across existing fleets and help manage fuel prices. Since its introduction, the biodiesel tax credit has played a crucial role in fostering growth in the renewable diesel industry, expanding U.S. biodiesel and renewable diesel production from around 100 million gallons in 2005 to nearly 4 billion gallons in 2023, all while contributing to a reduction in transportation-related carbon emissions.