Federal biodiesel blending tax incentive set to expire

The U.S. biodiesel blending tax incentive is set to expire after this year which could lower blending volumes if not extended.

Illinois Soybean Association board member Ron Kindred tells Brownfield the federal biodiesel incentive provides an extra dollar per gallon to blenders…

“We’ve been working on this for a while, trying to get another five-year extension on there before this one expires, so it gives a little certainty to the biodiesel producers,” he said.

Kindred, who farms near Atlanta, Illinois said the current incentive – that was passed three years ago – mostly provided retroactive support. But he said that doesn’t provide the certainty needed for blenders to increase production.

“There are no guarantees that that incentive will get passed and will be made retroactive…,” he said. “To be competitive, they need that incentive right now and it actually gives us a little advantage over petroleum diesel.”

Bills providing a biodiesel tax credit were introduced in the Senate and House last year, by Iowa Republicans Cindy Axne and Chuck Grassley, but never made it out of committee.

Kindred said Illinois recently passed a state biodiesel incentive that will provide support for B20 blends by 2026.

“It’s given more certainty to our industry here in Illinois and we’re doing our part to try to clean the air and improve the environment by blending 20 percent biodiesel,” Kindred said.

He said biodiesel blends decrease emissions compared to ‘standard’ petroleum fuel. Kindred said he’s been to Washington D.C. twice in the last month taking part in discussions on biofuel incentives and the Farm Bill with Clean Fuels Alliance America and the American Soybean Association. 

Ron Kindred Interview

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