FOR IMMEDIATE RELEASE
Contact: Ben Evans/202-737-8801
WASHINGTON – Nearly 100 biodiesel leaders from across the country will press lawmakers on Capitol Hill Tuesday to reinstate the biodiesel tax incentive as a domestic production credit in line with a proposal passed unanimously by the Senate Finance Committee in July.
The $1-per-gallon incentive expired on Dec. 31, 2014, marking the fourth time in six years Congress has allowed it to lapse. The continued uncertainty surrounding the incentive has severely stymied investment and growth in the industry.
“Members of Congress should understand that in the business world, this kind of unpredictability makes planning for growth nearly impossible,” said Harry Simpson, CEO of Crimson Renewable Energy, a Denver-based company that operates one of the largest biodiesel refineries on the West Coast, in Bakersfield, Calif. “People wonder why the economy isn’t doing better, why more companies aren’t hiring, and it’s this kind of inaction in Washington that is holding companies back. We are urging responsible lawmakers to step up and pass a producer’s tax credit as quickly as possible so we can get the biodiesel industry back on track. It is a critical issue for our company.”
This year, the industry is backing a key reform passed by the Senate Finance Committee in S. 1946 that would convert the incentive from a blender’s credit to a producer’s credit focused on domestic production. Under the existing blender’s structure, biodiesel that is produced overseas and blended in the U.S. is increasingly taking advantage of the incentive, undermining U.S. production and directing U.S. tax benefits to foreign producers. By narrowing the eligibility for the credit to domestic producers, the reform would save about $90 million, according to the Joint Committee on Taxation.
“This is a common-sense reform that will appropriately focus the incentive on stimulating U.S. production and jobs while streamlining IRS administration of the credit,” said Anne Steckel, the National Biodiesel Board’s vice president of federal affairs. “It makes a good policy better.”
“The biodiesel tax incentive has broad bipartisan support because it works to create jobs and economic activity, and it furthers our energy policy goals to diversify the fuel markets and reduce emissions,” Steckel added. “It is irresponsible that Congress has allowed this incentive to remain lapsed all year when we know the impact it has, particularly when billions of dollars of incentives for fossil fuels industries are written permanently into the tax code. We should have clear, forward-looking tax policy, not this unpredictable, on-again, off-again system where Congress waits until the 11th hour every year to get anything done. ”
Made from an increasingly diverse mix of resources such as recycled cooking oil, soybean oil and animal fats, biodiesel is a renewable, clean-burning diesel replacement used in existing diesel engines. It is the first and only commercial-scale fuel produced across the U.S. to meet the EPA’s definition as an Advanced Biofuel - meaning the EPA has determined that it reduces greenhouse gas emissions by more than 50 percent when compared with petroleum diesel.
Biodiesel has displaced about 1.8 billion gallons of petroleum diesel in the U.S. in each of the past two years – and more than 8 billion gallons over the last decade. It is produced in nearly every state in the country and is supporting more than 62,000 jobs. NBB is the industry’s U.S. trade association.
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For more details visit biodiesel.org.