The group that represents truckstops and travel plazas is urging renewal of the federal $1-a-gallon biodiesel tax incentive.

Refrigerated Transporter reports that NATSO has teamed up with other partners in the industry, such as the National Association of Convenience Stores, the Petroleum Marketers Association of America, and the Society of Independent Gasoline Marketers of America, to send a letter to U.S. Senate members, asking them to support U.S. Sen. Charles Grassley’s amendment to the Small Business Lending Act of 2010 that would extend the biodiesel tax credit through December 31, 2010:

“It is vital that Congress reinstate the biodiesel tax credit to ensure a healthy biodiesel market for producers and consumers,” said Lisa Mullings, NATSO president and chief executive officer. “The lapse of this credit and drastic cuts in production are undermining fuel retailers’ commitment to offering alternative fuels to the public and to investing in biodiesel infrastructure. The expiration of the tax credit has put thousands of jobs at stake and threatens the industry’s ability to meet the mandated renewable fuels standard.”

Since the $1 per gallon biodiesel tax credit expired, US biodiesel production has plummeted by more than 80%. At the same time, motorists are changing buying habits as the price of biodiesel surpasses other fuels. The $1-per-gallon blender tax credit makes biodiesel cost competitive with conventional diesel fuel. The expiration of the tax credit, coupled with sagging consumer demand, has caused many producers to shut down or severely scale back production.

Truckstop operators say this is also part of their efforts to support environmental efforts.