Clean fuels producers, soybean growers, and oilseed processors were pleased to see the U.S. Treasury Department’s notice of intent to propose regulation on the Clean Fuel Production Credit (45Z) released on Friday addressed the issue of imported used cooking oil being used to qualify for the credit. However, they are disappointed in the lack of guidance for farmers to utilize climate smart agriculture practices to produce crops approved for Sustainable Aviation Fuel.

The American Soybean Association and National Oilseed Processors Association appreciate that the guidance addresses their concerns about imported waste feedstocks for biofuel production by “ensuring imported used cooking oil remains ineligible for the 45Z credit through the GREET model until such time that Treasury can promulgate substantiation regulations for imports.”

Through September 2024, the United States has imported 5.4 billion pounds of UCO and tallow, far surpassing total record import levels from 2023, but according to NOPA, “by restricting import eligibility, the 45Z tax credit will benefit American farmers and processors as Congress intended.”

Clean Fuels Alliance America Vice President of Federal Affairs Kurt Kovarik said, “Clean fuel producers still need the carbon intensity scores from the GREET model to calculate their credit values; this missing information is key to enabling them to negotiate feedstock and fuel offtake agreements for the year and get back to business.”