Lawmakers Introduce Biodiesel Blender’s Tax Credit Extension

On May 1, Representatives Mike Carey (R-OH), Andrew Garbarino (R-NY), Dusty Johnson (R-SD), Mike Kelly (R-PA), Darin LaHood (R-IL), Mariannette Miller-Meeks (R-IA), Ashely Hinson (R-IA) and Claudia Tenney (R-NY) introduced the “Biodiesel Tax Credit Extension Act of 2025,” (H.R. 3137) which aims to extend the $1 per gallon biodiesel blender’s tax credit through 2026. Extending the biodiesel blender’s tax credit is important to energy marketers to sell a growing portfolio of affordable, efficient, and environmentally friendly liquid fuels that are helping to reduce emissions while propelling Americans forward and lowering heating fuel costs.

Unfortunately, the Inflation Reduction Act (IRA), which was signed into law in 2022, replaced the biodiesel blender’s tax credit with a new 45Z Clean Fuel Production Credit (CFPC) based on carbon intensity scores. Ethanol, biodiesel, renewable diesel and sustainable aviation fuel (SAF) will all be eligible for the new production tax credit, however, the Department of the Treasury has yet to publish final CFPC guidance. Therefore, it is important that Congress acts soon to extend the biodiesel blender’s tax credit to give impacted industries market certainty for at least another year.

• Heating fuels marketers — click here to write Congress to extend the Biodiesel Blender’s Tax Credit.
• Motor fuels marketers — click here to write Congress to extend the Biodiesel Blender’s Tax Credit.

Meanwhile, EMA submitted comments on 45Z implementation and the Importance of Extending the Biofuel Blender’s Tax Credit. Click here to read the comments.