Groups urge ‘flexible’ tax credit on low-emission fuels

Source: By Marc Heller, E&E News • Posted: Wednesday, June 12, 2024

Biofuel groups say they expect the USDA to seek guidance on how climate-smart farming should play into the clean fuel production tax credit in 2025.

Renewable fuel options pictured for sale at a gas station.

Renewable fuel options pictured for sale in 2016 at a gas station in Glyndon, Minnesota. Alex Milan Tracy/Sipa via AP

Stung by criticism that a tax credit for sustainable aviation fuel snubbed farmers for 2024, the Biden administration may be looking to patch the relationship with a new clean energy tax credit that takes effect next year.

Biofuel industry representatives said they expect the Department of Agriculture in the coming weeks to formally ask for suggestions on how farmers could play a bigger role in the new clean fuel production credit, which will reward producers of transportation fuel that limits greenhouse gas impacts.

The USDA has signaled to industry groups that it will publish a “request for information” to quickly gather insights on matching farmland conservation with the coming tax credit’s climate goals, the organizations said.

A USDA spokesman, Allan Rodriguez, declined Monday to comment on the department’s plans. But Geoff Cooper, president and CEO of the Renewable Fuels Association, said he expects an accelerated timeline.