Sens. Chuck Grassley (R-IA) and Amy Klobuchar (D-MN) introduced legislation this week to extend the Small Agri-Biodiesel Producer Credit through 2029. The credit of $0.20 per gallon on the first 15 million gallons of production for producers using crop oils and animal fats is set to expire on December 31 this year unless Congress adopts the extension.

Clean Fuels Alliance America supports the move to provide certainty for small biodiesel producers across the country. “Small biodiesel producers are making an outsized contribution to America’s energy security right now, producing lower-cost, drop-in distillate fuel that’s needed to keep the economy moving,” said Kurt Kovarik, Clean Fuels’ Vice President of Federal Affairs. “These companies are investing in rural communities, creating and preserving jobs, and running full out to provide cleaner, better, more affordable fuel to meet today’s demand.”

The extension is particularly important to small producers in Minnesota and Iowa, according to Monte Shaw, executive director of the Iowa Renewable Fuels Association. “This extension gives Iowa producers the runway they need to keep turning Iowa-grown feedstocks into homegrown fuel, supporting farmers and strengthening rural communities,” says Shaw. The extension would provide additional certainty for Iowa’s small biodiesel producers as the industry transitions to the §45Z Clean Fuels Production Credit.