NBB In Sight

State legislators play a vital role in biodiesel's growth
By Joe Jobe | July 01, 2006
here's no question that federal legislation has driven much of the increased demand for biodiesel, but we shouldn't ignore another valuable driver-U.S. state legislation. Across the country, state governments are taking the lead in promoting the production and use of biodiesel. The National Biodiesel Board (NBB) has monitored more than 160 bills specifically addressing biodiesel throughout the various state legislative sessions. While not all the sessions have concluded, many states have already approved groundbreaking legislation.
Iowa is one of many states this year that has enacted legislation that will significantly impact the use of biodiesel. Gov. Tom Vilsack signed into law two renewable fuels and infrastructure bills, HF 2754 and HF 2759 (see page 27).

Gov. Christine Gregoire in Washington signed into law a 2 percent biodiesel volumetric requirement. The requirement goes into effect Dec. 1, 2008, or when feedstock grown in the state can meet the 2 percent requirement, whichever comes first. Similarly, California Gov. Arnold Schwarzenegger issued an executive order establishing a target of 20 percent renewable fuel use in the state by 2010.

Colorado, Arizona, Hawaii and Maryland added requirements to the books for state fleets to use or give preference to biodiesel blends when available. Kansas will award qualified biodiesel fuel producers with a 30-cent-per-gallon incentive for each gallon they sell, beginning April 1, 2007. Arkansas provides for a 50-cent excise tax credit on B100 gallons used for blending, limited to the first 2 percent of total gallons of biodiesel blended. Meanwhile, Indiana's Gov. Mitch Daniels signed into law an extension of tax credits for production, blending and retail sales of biodiesel.

Virginia passed a Biofuels Production Fund and Grant Incentive Program, while Georgia has defined biodiesel according to the ASTM standard for biodiesel. The state has made this public commitment to accept nothing less than the legal specification for biodiesel.

Biodiesel laws have also reached the world of heating oil. In New York, Gov. George Pataki signed a residential bioheat credit that takes effect in July. The bill provides for a state income tax incentive that allows homeowners to receive 1 cent per percentage of biodiesel blended into heating oil, not to exceed 20 cents a gallon.

As a whole, bills have also included point of taxation clarification and authorization of studies; they also pertained to schools and buses, and biodiesel promotion. In addition, bills have provided for public lands for oilseed production, conversion allowances and an education fund. A detailed database of state laws and legislation is available to NBB members on the Members Only section of www.biodiesel.org. This valuable membership benefit catalogs current and proposed laws pertaining to biodiesel by state.

As state energy policy brings volumes of biodiesel to various regions, it is increasingly important to advocate relentless fuel quality efforts. These ensure customer satisfaction and enhance biodiesel's reputation as a reliable, high-performance fuel. BQ-9000 remains the premier quality assurance program in North America, and has gained a remarkable amount of traction among biodiesel producers and distributors in recent months. For an update on BQ-9000 participation, visit www.bq-9000.org.

Many stakeholders have worked very hard to promote the use of biodiesel in their states, and they should be commended for their leadership. State energy initiatives are expected to play a larger role in energy policy, and the momentum for biodiesel gets stronger by the day.
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