NATSO Condemns Legislation to Convert Biodiesel Blenders’ Tax Credit To Producers’ Credit

Iowa Senator Chuck Grassley on April 26 introduced The American Renewable Fuel and Job Creation Act of 2017 that seeks to extend the $1 per gallon biodiesel tax credit but transfer it upstream to a producers’ credit.

NATSO and the Advanced Biofuels Association were among those who sharply criticized the measure, which will push up fuel prices for retailers and consumers.
NATSO has long argued that reforming the in this fashion would result in fuel retailers paying a higher price for biodiesel that inevitably would be passed down to consumers in the form of higher prices at the pump, leading to less biodiesel consumption in the United States and hindering the government's efforts to utilize cleaner burning fuels.

In criticizing Senator Grassley’s measure, NATSO President and CEO Lisa Mullings said that NATSO and entire fuels marketing community could reevaluate its position on the biodiesel tax credit and the entire Renewable Fuel Standard (RFS).

“In previous years, NATSO has worked together with biodiesel producers and the entire renewable fuels community to protect the biodiesel blenders' tax credit and to support a robust Renewable Fuel Standard,” Mullings said in a statement. “NATSO supported these policies because it was in the interest of our members' customers. In recent months, however, domestic biodiesel producers have changed their approach, prioritizing their own bottom line as opposed to those who purchase and consume their product. If these efforts continue, NATSO and the entire fuels marketing community will need to reevaluate its position on the biodiesel tax credit and the entire RFS.

NATSO successfully opposed efforts by biodiesel producer interests in 2015 and 2016 to move the biodiesel blenders' credit upstream to the producer level.
Since 2005, the $1.00 per gallon biodiesel blenders’ tax credit has helped fuel retailers to sell biodiesel at a price that is cost competitive with diesel, thereby incentivizing consumer consumption. Converting the tax credit from a blenders' credit to a producers' credit would drive up biodiesel prices to a degree that would diminish consumer interest in the product, ultimately hindering U.S. efforts to advance the utilization of cleaner burning fuels.

“When fuel prices increase by just 1 or 2 cents per gallon, customers begin to shop for a better deal. This will lead to less biodiesel consumption and thwart government efforts to expand U.S. consumption of cleaner burning fuels,” Mullings said. “The blenders’ credit for biodiesel is a proven and sound policy that is successfully creating a market for biodiesel and renewable diesel and building consumer acceptance.”

The Advanced Biofuels Association (ABFA) also criticized the measure arguing that the legislation harms every user of diesel and heating oil in the United States to protect a corporate welfare policy for the soybean industry.

ABFA President Michael McAdams said every driver who uses diesel will pay more as a result of eliminating competition in the market.

McAdams said the senators “should join the rest of the industry and support the existing credit, which is supported by every seller of every gallon of fuel in the United States.”

Joining Grassley and Cantwell to co-sponsor the legislation were Sens. Pat

Roberts (R-Kan.), Mazie Hirono (D-Hawaii), Roy Blunt (R-Mo.), Sheldon

Whitehouse (D-R.I.), Joni Ernst (R-Iowa), Heidi Heitkamp (D-N.D.), John Thune

(R-S.D.), Tom Udall (D-N.M.), Martin Heinrich (D-N.M.), Jeanne Shaheen (D-

N.H.), Amy Klobuchar (D-Minn.), Al Franken (D-Minn.), Joe Donnelly (D-Ind.) and

Patty Murray (D- Wash.).



via Business Feeds

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