Late last week, the government released short-term guidance on accessing clean fuel tax credits under the Inflation Reduction Act.  However, the announcement fell short of finalizing the program’s details.  Farm Policy News said biofuel groups were hoping for more clarity on the tax credits for fuels that help combat climate change.  The groups are hopeful that more complete guidance will provide a pathway for corn-based ethanol to expand its market as a sustainable aviation fuel feedstock.

 

The Treasury Department said it provides further details on how to ensure fuels meet certain emissions-reductions criteria to access the subsidy and adds that a crucial climate model upon which the program relies will be available in the future.  Reuters said the administration intends to release the program’s climate model this week, but it will not include adjustments for so-called climate-smart agricultural practices like no-till farming, which ethanol hoped it could use to meet the lifecycle emissions requirements. 

 

 

U.S. agriculture groups had mixed reaction to Treasury Department’s 45Z Tax Credit announcement.  Growth Energy CEO Emily Skor said the long overdue guidance is far from complete.  “It still lacks critical details that are needed to help ensure that American biofuel producers and farmers can lead the world in clean fuel production,” she said.

 

Geoff Cooper of the Renewable Fuels Association said, “The credit must allow for the inclusion of efficient farming practices, recognition of additional feedstocks and ethanol production technologies, and the ability for producers to secure their own carbon intensity values.”

 

The National Corn Growers Association said the announcement was a “missed opportunity for growers.” Kurt Kovarik of Clean Fuels Alliance America says they look forward to working with members to evaluate the overdue guidance and forthcoming GREET model, which provides necessary carbon intensity scores for fuel producers.

 

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