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U.S. Senator Sherrod Brown has introduced bipartisan legislation seeking to prevent taxpayer money from subsidizing biofuels made with foreign feedstocks, such as Chinese used cooking oil and Brazilian ethanol. The bill proposes the restriction of the 45Z Clean Fuel Production Credit to biofuels made from domestically-sourced feedstocks and extends the credit for a decade. This move is expected to allow the American ethanol industry adequate time and financial incentive to build the infrastructure required to produce sustainable aviation fuel, reduce reliance on foreign fuel, and open new markets for farmers, increasing ethanol production across the Midwest.
U.S. Senator Proposes Legislation to Limit Biofuel Taxpayer Subsidies
U.S. Senator Sherrod Brown (D-OH) has introduced bipartisan legislation aiming to prevent taxpayer money from subsidizing biofuels created using imported feedstocks, such as Chinese used cooking oil and Brazilian ethanol. The proposed law also seeks to extend the 45Z Clean Fuel Production Credit. Tadd Nicholson, Executive Director of the Ohio Corn and Wheat Growers Association, joined Brown in the announcement.
The 45Z Clean Fuel Production Credit was designed to encourage America’s energy independence and promote the production of biofuels using domestically-produced feedstocks. However, a recent influx of Chinese used cooking oil being used for U.S. biofuel production threatens the utilization of American feedstocks. In July, Brown urged the Biden Administration and Treasury Secretary Janet Yellen to limit the 45Z Credit to biofuels made from domestically-sourced feedstocks. His proposed law will ensure this tax credit only applies to biofuels manufactured with local feedstocks.
The legislation includes an extension of the credit for 10 years, thereby providing the American ethanol industry with additional time and financial motivation to establish the necessary infrastructure for sustainable aviation fuel production. This will reduce U.S. dependence on foreign fuel, create new opportunities for farmers, and boost Midwest ethanol production.
“American tax dollars should support American farmers – not imported feedstocks…Our bipartisan bill ensures these investments benefit Ohio farmers and Ohio energy producers,” stated Brown.
“Producing low carbon fuels has made [Ohio’s family grain farms] profitable for years… Senator Brown’s bill gives that market certainty and ensures that our national investment in renewable energy will benefit American energy producers first…” added Tadd Nicholson, Executive Director, Ohio Corn and Wheat Growers Association.
The legislation is co-led by Senator Roger Marshall (R-KS) and is co-sponsored by a number of senators. Companion legislation was introduced in the House of Representatives by Representatives Tracey Mann (R-KS-01) and Marcy Kaptur (D-OH-09).
The full text of the proposed legislation can be found HERE.
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