ALEXANDRIA, Va.—NACS, along with other associations, has written a letter to congressional leaders asking them to extend the biodiesel blenders’ tax credit and ensure that there is parity with jet renewable fuel and other alternative fuels using the same blend stocks.
“This $1.00 per gallon blenders’ credit has successfully decreased carbon emissions associated with transportation fuel and has promoted America’s energy security,” reads the letter. “The credit can continue fulfilling this important purpose if Congress extends the existing law and does so at an amount that is at parity with other alternative transportation fuels that compete for the same feedstock, such as sustainable aviation fuel.”
The transportation fuel markets are experiencing increased pressure amid skyrocketing diesel prices, supply chain disruptions and inflation. None of these trends are letting up any time soon, and this pressure will make it challenging on the markets to ensure consistent diesel supply in all regions.
“The biodiesel blenders’ tax credit has worked successfully to build a robust biodiesel and renewable diesel industry in the United States; those products enhance our supply of transportation energy for heavy-duty trucks, limiting our exposure to global petroleum markets while improving the transportation sector’s emissions footprint,” said the associations in the letter.
The letter says that as a result of the tax credit, the U.S. biodiesel and renewable diesel market has grown from roughly 100 million gallons in 2005 to about 3.2 billion gallons in 2021.
“This number will continue to grow as new plants are built and continue to come online,” the letter states.
The associations said that the biodiesel blenders’ tax credit is an important demand stimulus, as it improves plant efficiencies, encourages investment in U.S. distribution infrastructure and supports small businesses and high-paying jobs throughout the country. Also, the biodiesel blenders’ tax credit lowers the price that commercial drivers pay for fuel and millions of heating oil customers pay to heat their homes.
“Extending the biodiesel blenders’ tax credit at a dollar amount that is at parity with the dollar level for other alternative fuels will allow us to continue to provide these economic and environmental benefits,” they said in the letter.
“Congress has an opportunity to lower our country’s carbon emissions while also lowering the cost of fuel for commercial drivers and heating oil customers by extending the biodiesel blenders’ tax credit at parity with other alternative transportation fuels that compete for the same feedstock. We urge you to do so this Congress.”