#United States #trucking #Alexandria, Virginia #Biodiesel #Fuel Retailers

Urgent Call for the Extension of the Biodiesel Tax Credit

As inflation continues to loom over the American economy, prominent organizations representing the fuel retail and trucking industries are making a unified plea to Congress to extend the 'Section 40A' Biodiesel Blenders' Tax Credit. This $1 per gallon credit has been instrumental in stabilizing fuel prices and supporting the advanced biofuel market, which is crucial for both consumers and businesses.

The Importance of Renewing the Tax Credit

In a recent communication directed at the House Ways and Means Committee, NATSO—representing the interests of America's truck stops and travel centers—alongside SIGMA, the American Trucking Associations (ATA), and other key stakeholders, emphasized the dire consequences of allowing this tax credit to expire. The expiration of the credit at the end of 2024 is expected to result in higher fuel prices, which could translate to increased costs for everyday goods ranging from food to medicine.

Historically, biodiesel and renewable diesel have played a pivotal role in reducing carbon emissions across various sectors, notably trucking, home heating oil, and rail transport. With fuel retailers advocating for tax policies that ensure lower fuel prices, the continuation of the Biodiesel Tax Credit is seen as essential for promoting cleaner-burning, affordable fuel options that diminish reliance on foreign energy sources.

Economic Implications

Economists are forecasting a potential inflation rate increase of 2.5% in 2025, making this an urgent economic issue in the United States. The proposed extension of the Biodiesel Blenders' Tax Credit is a strategic move that Congress could implement to counteract inflationary pressures. Indeed, this credit not only lowers diesel costs for trucking companies, but it also alleviates shipping expenses, ultimately benefitting consumers by keeping prices down on a range of transported goods.

Since its establishment in 2004, the Biodiesel Blenders' Tax Credit has motivated retailers to invest in the infrastructure vital for low-carbon fuel alternatives and made renewable fuel blends more accessible and affordable. The biodiesel and renewable diesel market in the United States has seen tremendous growth—from about 100 million gallons in 2005 to approximately 4 billion gallons in 2023—significantly contributing to the reduction of carbon emissions tied to transportation.

Industry Voices Unite

The coalition of organizations advocating for the tax credit renewal includes the Clean Freight Coalition (CFC), Energy Marketers of America (EMA), the National Association of Convenience Stores (NACS), and the Truckload Carriers Association (TCA). They assert that the expiration of the Biodiesel Tax Credit has already led to devastating consequences for biofuels supply chains, prompting numerous biodiesel production facilities to curtail operations or close entirely.

In their letter to Congress, the coalition warned, "Consumers should not have to incur unnecessary cost increases for everyday goods if stability is not restored to biofuels markets. The biodiesel tax credit is crucial to maintaining the affordability and availability of renewable fuels."

Representatives argue that the renewal of the tax credit is not just about protecting a particular sector; rather, it’s about safeguarding consumer interests and ensuring a competitive, stable market environment in the face of rising costs and economic uncertainty.

The biodiesel industry enhances energy security by diversifying energy sources and ensuring that consumers have access to economical fuel options. The call to action signifies a critical moment for congressional intervention which is necessary for sustaining the progress achieved in renewable fuel production and provision.

Conclusion

As the deadline for the tax credit draws nearer, all eyes are on Congress to act swiftly. The continuation of the Biodiesel Blenders' Tax Credit could mean the difference between stable fuel prices or the looming threat of escalating costs, impacting the lives of everyday Americans.

With leading associations united in their call, the message is clear: ensuring the longevity of the Biodiesel Blenders' Tax Credit is essential for a sustainable, economically viable future in the nation’s ongoing journey toward greener energy solutions.