Rep. Brad Schneider, D-Ill.
October 23, 2024
BY Erin Voegele
Rep. Brad Schneider, D-Ill., on Oct. 22 introduced the Expanding Clean Fuel Production Act. The bill aims to extend the 45z clean fuel production credit for 10 additional years, through 2037. The bill is cosponsored by Reps. Dan Kildee, D-Mich, and Julia Brownley, D-Calif.
The 45Z tax credit, established by the Inflation Reduction Act of 2022, provides a tax credit for the production and sale of low-emission transformation fuels. The credit starts at 20 cents per gallon for non-aviation fuels and 35 cents per gallon for sustainable aviation fuel (SAF). For facilities that satisfy the prevailing wage and apprenticeship requirements, the value of the tax credit is up to $1 per gallon for non-aviation fuels and $1.75 per gallon for SAF. The tax credit is currently in place for 2025, 2026 and 2027. The legislation introduced by Schneider aims to extend the tax credit through 2037.
“I’m proud to introduce this legislation with Reps. Kildee and Brownley to extend the SAF credit, boost production of clean fuels and position the U.S. as a global leader in production and use of sustainable fuels,” Schneider said. “A ten-year extension would allow for sustained investment in production to accelerate the transition to cleaner fuels and to significantly cut greenhouse gas emissions from the aviation industry, in particular. We are already seeing the impact of the Inflation Reduction Act’s investments on U.S. production of sustainable fuels.”
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The Sustainable Aviation Fuel (SAF) Coalition and Growth Energy are among the groups that have spoken out in support of Schneider’s bill.
“We applaud Representative Schneider and his colleagues Representatives Kildee and Brownley for their efforts to extend incentives for SAF,” said Alison Graab, executive direct of the SAF Coalition. “We look forward to working with them on both an extension as well as enhancing and strengthening the incentive. Advancing sustainable aviation fuel demonstrates a clear commitment to the environmental and economic promises SAF holds, and incentives that are durable and attract investment are essential to unlocking that potential and driving the progress needed to sustain and grow the SAF industry.”
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"Farmers and renewable fuel producers are making decisions today about how to invest their time and money in the years to come,” said Emily Skor, CEO of Growth Energy. “With this bill they would be able to make those decisions with greater confidence, and make the kind of investments that increase efficiency, lower their carbon intensity, create jobs, and grow the rural economy," said Growth Energy CEO Emily Skor. "We commend Reps. Schneider, Kildee, and Brownley for taking the lead on this issue in the House, and we look forward to working with them and all of our biofuel champions in this Congress and the next to extend the 45Z tax credit and maximize its benefits for farmers, producers, and the communities that depend on them."
At least two other pieces of legislation have been introduced in recent months with the aim of extending the 45Z tax credit. The Farmer First Fuel Incentives Act was introduced in both the U.S. Senate and the U.S. House of Representatives in September. That bill aims extend the 45Z Clean Fuel Production Credit for an additional seven years, through the end of 2034, and would restrict the credit to fuels made from domestically produced feedstock.
The U.S. Energy Information Administration maintained its forecast for 2025 and 2026 biodiesel, renewable diesel and sustainable aviation fuel (SAF) production in its latest Short-Term Energy Outlook, released July 8.
XCF Global Inc. on July 10 shared its strategic plan to invest close to $1 billion in developing a network of SAF production facilities, expanding its U.S. footprint, and advancing its international growth strategy.
U.S. fuel ethanol capacity fell slightly in April, while biodiesel and renewable diesel capacity held steady, according to data released by the U.S. EIA on June 30. Feedstock consumption was down when compared to the previous month.
XCF Global Inc. on July 8 provided a production update on its flagship New Rise Reno facility, underscoring that the plant has successfully produced SAF, renewable diesel, and renewable naphtha during its initial ramp-up.
The U.S. EPA on July 8 hosted virtual public hearing to gather input on the agency’s recently released proposed rule to set 2026 and 2027 RFS RVOs. Members of the biofuel industry were among those to offer testimony during the event.