NACS, along with NATSO and SIGMA, this week expressed serious concern with the “Section 45Z” Clean Fuel Production Credit.

In a joint release, the associations said: “The U.S. Treasury Department was tasked with writing guidelines that would create a viable regulatory framework for ‘45Z’ and bolster the flailing U.S. biofuels market. But years of regulatory reviews, public comments, copious stakeholder input and Congressional reevaluation can’t alter the fact that ‘45Z’ is a giant step backward for American biofuel policy. NACS, NATSO and SIGMA, which represent 90% of retail fuel sales, urge Congress and the Administration to support simpler biofuel policies that would quickly reinvigorate biodiesel consumption and higher ethanol blends while enhancing the economy and energy market security.”

“The transition away from the Biodiesel Tax Credit to the ‘45Z’ production credit instituted a catastrophic decline in biofuels consumption that hurts the economy,” said NACS Deputy General Counsel Matt Durand. “The Trump Administration inherited this unworkable mess. Congress can fix it by bringing back the Biodiesel Tax Credit, which has a proven track record of delivering lower prices to consumers while benefitting farmers and biofuel producers.”

NACS, SIGMA and NATSO urge the Administration to pursue more meaningful and measurable biofuel policies—such as reinstating the Biodiesel Tax Credit—that can quickly revive biodiesel consumption and mitigate the damage caused by ‘45Z’ while enhancing the economy and energy market security.

In 2025, biodiesel consumption plummeted to 960 million gallons through the end of October from more than 2 billion gallons in 2024. Newly released Environmental Protection Agency data underscores the continued downward spiral of domestic biofuel consumption. Tradable credits known as Renewable Identification Numbers (RIN) used to demonstrate compliance with the Renewable Fuel Standard dropped 22% for biodiesel in 2025 compared with the prior year. Ethanol RINs also declined, further highlighting that ‘45Z’ is not providing support for farmers.

This week’s proposal from Treasury “underscores the need to reinstate the Biodiesel Tax Credit, which is more robust and transparent within the fuel value chain, allowing fuel retailers to pass meaningful savings along to consumers,” the associations said.