Senators introduce bill to extend, reform biodiesel tax credit
U.S. Sens. Joe Donnelly (D-IN), Chuck Grassley (R-IA) and Maria Cantwell (D-WA), ranking member on the Senate Energy and Natural Resources Committee, recently introduced legislation to reform the biodiesel tax credit and extend the new policy for three years.
The American Renewable Fuel and Job Creation Act of 2017 would transfer the credit from the blenders to the producers of biofuels. This change is intended to ensure that the tax credit incentivizes domestic production rather than imported fuel. Because blending can occur at multiple stages of fuel distribution, it will also make the incentive easier to administer and less susceptible to abuse.
“Indiana is a leading producer of biodiesel, which is an important facet of an all-in energy approach,” Donnelly said. “This bipartisan legislation would promote the use of American-grown soybeans and other domestic sources of renewable biodiesel, helping to reduce our nation’s reliance on fuels imported from abroad.”
In the first quarter of 2017, imports are 10 percent higher than they were at this time in 2016. Foreign biodiesel often benefits both from the existing tax credit and from additional foreign subsidies, which makes it difficult for domestic biodiesel facilities to compete, according to a press release from Grassley. In 2015, the U.S. Treasury spent more than $600 million on tax credits for imported biodiesel and renewable diesel.
Sens. Pat Roberts (R-KS), Mazie Hirono (D-HI), Roy Blunt (R-MO), Sheldon Whitehouse (D-RI), Joni Ernst (R-IA), Heidi Heitkamp (D-ND), John Thune (R-SD), Tom Udall (D-NM), Martin Heinrich (D-NM), Jeanne Shaheen (D-NH), Amy Klobuchar (D-MN), Al Franken (D-MN) and Patty Murray (D-WA) cosponsored the bill.
