Biodiesel Tax Incentive Extension Introduced
A bipartisan group of lawmakers in both the House and Senate this week introduced legislation to extend the biodiesel tax incentive for three years.
The Biodiesel Tax Incentive Reform and Extension Act would extend the $1 per gallon tax credit from 2012 through 2014 and would reform the biodiesel tax incentive from a blenders excise tax credit to a production excise tax credit. “Biodiesel development and production is an important job creator for this country,” said House co-sponsor Congressman Aaron Schock (R-IL), who notes that biodiesel is an important industry for soybean producers and the rural economy of his home state.
“Illinois soybean farmers have a great interest in the development and expansion of the U.S. biodiesel industry. Biodiesel has provided a significant market opportunity for soybean farmers, and jobs and economic development for rural communities,” said American Soybean Association Vice President Ron Kindred of Atlanta, Ill.
Schock says that extending the credit will also help develop other crops for the production of biodiesel, such as Pennycress, which has an exceptionally high oil content. Initial research indicates that an acre of pennycress can yield up to 110 gallons of biodiesel, twice what can be produced from an equal amount of soybeans.
The National Biodiesel Board (NBB) is pleased that extension legislation has been introduced, now that the industry is getting back up to speed after losing the tax incentive for an entire year. “Unfortunately, we don’t have to speculate about what would happen to our industry if this tax incentive goes away. We saw the fallout last year when the incentive temporarily expired. Plants closed and thousands of people were laid off. It would be a terrible mistake if Congress allowed that to happen again,” said NBB Chairman Gary Haer. “We are poised for a record year of production this year, and this bill would provide the market and investor certainty that the industry needs to continue building on that progress.”
1 Comment
John
More insanity from the bio-fuel crowd. Why would you give the credit for production opposed to use??? That means if you make it you get a dollar from the tax payer without it actually being used. Brilliant. I noticed both people interviewed in the article never once mentioned RFS2 in which the EPA mandates 800 million gallons this year and 1 billion gallons next year. Of those gallons, how much gets exported? Anybody remember “splash and dash”(from 2008) or the garbage about energy independence? Wouldn’t think we would be exporting ethanol and bio-diesel if energy independence was the primary goal of all this important legislation. When the tax incentive lapsed last year RFS2 was not yet enacted therefore the NBB claim of thousands of layoffs and plant closings would not happen. “Obligated parties” have to use a set amount under RFS2 under threat of of substantial fines. If the the obligates parties are mandated by law to use a certain amount, why does there have to be any tax incentives to make it. Another great example of our idiot congressmen not understanding the issue while lobby groups throw money at them. With logic used in the above article, this country will never get the deficit under control.
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