A big focus of last week’s American Coalition for Ethanol 39th annual conference was on the 45Z clean fuel production tax credit, with the final panel on Friday serving up an overview of policy, modeling, and compliance for biofuel producers.

USDA released its final guidelines for the production of regenerative agricultural biofuel feedstocks in June and Kate Zook, Acting Director of USDA’s Office of Energy and Environmental Policy, explained that it covers corn, soy, sorghum, and spring canola. “The official calculator that is used to calculate the farm scale carbon intensity is USDA’s Feedstock Carbon Intensity Calculator,” said Zook. “It reports out in CO2e per bushel and it contains all the practices and crops with USDA’s rule. So it is meant to work in tandem with USDA’s rule.”

Zook said the Department of Energy still must incorporate the calculator into the GREET model required by statute, and then Treasury must formally cite the USDA regulations. “We know from the regulatory agenda that 45Z is aimed to be finalized in November of this year,” she said. “This is a huge deal. It’s a huge deal for agriculture. If there’s a way that we can pass that value down to the farm and allow the farmer to have some power in this market with their grain, that’s an excellent opportunity.”

Kari Buttenhoff and Jamey Cline, both with Christianson PLLP, provided some insight into the modeling and compliance pieces for ethanol producers, acknowledging that every plant is different and the program is complicated and still not yet finalized. “With different markets comes uncertainty,” said Cline. “And this is exacerbated by the fact we don’t have a final rule for 45Z and have sought interpretation for very complex regulations since they were released. The industry is having to comply with a new regulation that doesn’t have all the rules down yet on paper, nor are they fully understood. In fact, because the market was being developed in real time, pricing and other benefits had to be developed.”

Listen to the panel conversation:
The 45Z Playbook: Policy, Modeling, and Compliance for Biofuel Producers – panel
Kate Zook, Acting Director, Office of Energy and Environmental Policy, USDA
Kari Buttenhoff, Christianson
Jamey Cline, Partner, Christianson PLLP
45Z Playbook panel 54:44

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