As President Donald Trump prepares to visit Iowa, a green diesel group is urging him to act fast in finalizing biofuel policies needed to restore regulatory clarity to agriculture and energy markets.
"Our progress is threatened by delays in policy decisions that should have been made by the preceding administration," Kurt Kovarik, vice president of federal affairs for Clean Fuels Alliance America, said in a letter sent to Trump. "We anticipate that you will quickly finalize these policies and secure your promise as the most pro-biofuel president in history."
Trump is set to tour a local business and make remarks focused on affordability and the economy during his visit to the nation's No. 1 corn producing state, according to White House Press Secretary Karoline Leavitt Monday.
The letter sent on Monday comes a few days after the White House completed a review of proposed Treasury Department rules for the Clean Fuel Production Tax Credit, known as 45Z, indicating the regulations could be publicly issued soon. The incentive, aimed at encouraging greater production of U.S. renewable fuels made from North American feedstocks like soybeans and canola, originated in the 2022 Inflation Reduction Act during the former Biden administration. It was revamped last summer in the "One Big Beautiful Bill Act" tax law.
The industry has been nervously waiting on Treasury to provide clarity on details of 45Z.
The incentive took effect last year and replaced a biofuel blenders' tax credit that had been in place for almost two decades. A key difference between the two is that 45Z's value is determined by the full lifecycle carbon-dioxide emissions from producing biofuels, as opposed to the older credit's flat $1-a-gallon value.
Cut through the clutter! We deliver the news you need to stay informed about farm, food and rural issues. Sign up for a FREE month of Agri-Pulse here.
Renewable fuel producers also are pressing the Environmental Protection Agency to issue final biofuel-blending rules for this year under the Renewable Fuel Standard (RFS).
"America’s soybean and canola farmers, oilseed processors, livestock industry, and biodiesel, renewable diesel and SAF producers need these policies finalized as quickly as possible," Kovarik wrote to Trump. "Regulatory delays create intolerable market uncertainty, putting the biodiesel and soybean industry’s investments and planned growth at risk."
The uncertain 45Z policy, combined with national biofuel-blending targets set under Biden that the bio-based diesel industry said were far below capacity, led biodiesel production in Iowa to plummet 31% last year from 2024, according to a statement Monday from the Iowa Renewable Fuels Association.
Providing market certainty through 45Z guidance and issuing final blending volumes "would have a near-immediate impact on fuel production and domestic commodity demand," Kovarik said.
Iowa is the U.S.'s biggest biodiesel producer and second-largest grower of soybeans after neighboring Illinois. It's also home to two of the most competitive congressional districts currently held by Republicans in this year's midterm elections.
A key change made to 45Z in Congress last year was restricting the credit to only fuels made with North American feedstock.
Washington-based Clean Fuels Alliance America represents the biodiesel, renewable diesel and sustainable aviation fuel industries, all essential to U.S. ag and energy security, Kovarik said.
.webp?t=1762183428)
