Congress Passes Two-Year Extension Of Biodiesel Tax Credit

At the end of 2014, Congress failed to extend the long-standing biodiesel blenders credit, which lets users of biodiesel claim a $1-per-gallon credit towards their taxes. For anybody using biodiesel, this can add up to some serious savings, but Congress has failed to reinstate the biodiesel credit four times since 2009, only to pass it retroactively later on down the road.

Well guess what? That’s exactly what Congress has done again. Biodiesel Magazine reports that the two-year extension on the tax credit that expired at the end of 2014 will be made retroactive back to the beginning of 2015. President Obama signed the band-aid legislation into place last month, and once again find themselves fighting the same fight they’ve had since 2009.

Anne Steckel, vice president of federal affairs for the National Biodiesel Board, called this a “missed opportunity” to reform the tax incentive, she still counts it as a win for America’s nascent biodiesel industry. Today many diesel-powered cars and trucks, including the Chevy Cruze Diesel and Ram 3500 HD, can run a blend of up to 20% biodiesel called B20.

There are also numerous conversion kits that allow for a 100% blend of biodiesel, though there are just a relative handful of fueling stations that offer pure plant-based biodiesel. Refined from waste crop materials or even algae, biodiesel could end up being a long-term solution to our energy woes, though the same factors that have hurt ethanol adoptions in America have also hindered biodiesel. Nevertheless, companies like Propel Fuels are bringing biodiesel to market, slowly but surely.

With gas prices below $2.00 a gallon in many places, you might wonder why anyone should be interested in biodiesel anymore. Yet it wasn’t that long ago that gas prices soared past $4.00 a gallon nationally, crippling the economy and launching a new wave of innovation seeking an alternative to a fuel with tremendous price volatility. Biodiesel is just one of many options America should consider to get out of the global oil rollercoaster, so we’re glad to see this tax credit implemented, however temporarily, once again.