State legislative sessions winding down

At one time, Nebraska biodiesel supporters felt a little like they had been behind in the count when it came to encouraging the growth of the biodiesel industry in their state. A number of neighboring states had policies in place that either required biodiesel's use or put together creative packages of tax policies and other incentives that brought investment and biodiesel production. Now Nebraska has scored a solid hit with the recent passage of legislation designed to spur investment in the state's biodiesel industry.

Nebraska Gov. Dave Heineman recently signed legislation creating a tax credit for individuals investing in the development of a Nebraska biodiesel production facility. Also, investments made in locally owned biodiesel facilities will be eligible for up to a 30 percent tax credit.

The ninth inning is also not over for other states. Tax policy is becoming a driving force for state legislatures encouraging the growth and use of alternative fuels, particularly biodiesel. The most common approach creates incentives through tax credits and/or exemptions, and investment credits. In Oklahoma, two bills are on their way to the governor. House Bill 1916 extends the income tax credit for certain biodiesel facilities for an additional year to Dec. 31, 2008. House Bill 1513 extends the biodiesel production tax credit to Dec. 31, 2012.

Other states are taking different approaches to encourage the development of biodiesel. In April, New Mexico Gov. Bill Richardson signed into law a measure that seeks to increase the use and production of biodiesel in his state. The bill requires diesel fuel sold in New Mexico to contain a 5 percent biodiesel blend by July 2012. Diesel purchased by state and local government and public schools must be B5 beginning July 2010.

Colorado boosted efforts to continue biofuels research and development. On May 23, Gov. Bill Ritter signed a bill that specifies 20 percent of funds appropriated to bioscience discovery evaluation will be used to provide grants to biofuel research projects, such as biodiesel. Another section of the new law stipulates certain program funds as grants to research institutions for biofuels research projects.

States are also recognizing biodiesel's benefits in efforts to combat climate change. Nevada has given school districts the ability to spend money received from local air pollution funds if the proposed expenditures assist in improving air quality. This includes using biodiesel in school buses. Several states, including Hawaii, New Hampshire and Pennsylvania, have proposals that include biodiesel as part of a renewable portfolio standard or to meet requirements for renewable energy targets.

With only a few, if any, remaining weeks in many state legislative sessions, some biodiesel supporters are sure to feel like they're rounding the base to home plate with many biodiesel bills becoming law.