Bipartisan and bicameral legislation has been introduced in Congress that would require the Treasury Department to restrict the eligibility of the 45Z Tax Credit to renewable fuels made only from domestically sourced feedstocks and extending the tax credit to make it a full ten-year credit.

Senators Roger Marshall (R-KS) and Sherrod Brown (D-OH)introduced the Farmer First Fuel Incentives Act in the Senate with companion legislation introduced by Representatives Tracy Mann (R-KS) and Marcy Kaptur (D-OH) in the House of Representatives. Senator Pete Ricketts (R-NE), Amy Klobuchar (D-MN), Deb Fischer (R-NE), Tammy Baldwin (D-WI), and Tina Smith (D-MN) also cosponsored the legislation.

The 10-year credit will give the ethanol industry the time and financial incentive to build up the infrastructure needed for the U.S. to be less reliant on foreign fuel, open new markets for farmers, and increase ethanol production across the Midwest. However, we recently learned that 45Z has a glaring flaw that needs to be fixed for farmers wanting to sell feedstocks to the biodiesel and renewable diesel industry. If 45Z goes into effect as is, taxpayers will be massively subsidizing Chinese used cooking oil and would all but eliminate the use of homegrown soy or corn oil in renewable diesel.The 10-year credit will give the ethanol industry the time and financial incentive to build up the infrastructure needed for the U.S. to be less reliant on foreign fuel, open new markets for farmers, and increase ethanol production across the Midwest. However, we recently learned that 45Z has a glaring flaw that needs to be fixed for farmers wanting to sell feedstocks to the biodiesel and renewable diesel industry. If 45Z goes into effect as is, taxpayers will be massively subsidizing Chinese used cooking oil and would all but eliminate the use of homegrown soy or corn oil in renewable diesel.