On March 24, 2014, several renewable fuel industry groups wrote a letter to U.S. Senate Finance Committee Chairman Ron Wyden and ranking member Orrin Hatch. These groups are asking the Senate Finance Committee to retroactively extend for multiple years a number of expired alternative fuel credits as the Committee plans to determine tax extender legislation.
Specifically, the groups request an extension of the Second Generation Biofuel Producer Tax Credit, the Special Depreciation Allowance for Second Generation Biofuel Plant Property, the Biodiesel and Renewable Diesel Fuels Credit, and the Alternative Fuel and Alternative Fuel Mixture Excise Tax Credit. These credits include a $1 per-gallon credit for biodiesel and renewable diesel, a $1.01 per-gallon credit for second-generation biofuels, and a 50-cent per-gallon credit for other kinds of alternative fuels.
These credits expired on December 31, 2013, which left biofuel developers in limbo as Congress debates whether to extend these provisions. As the letter states: "Advanced biofuel tax credits have allowed the biofuels industry to make great strides in reducing the cost of production and developing first-of-kind technologies to deploy the most innovative fuel in the world." The letter also stresses how non-American global competitors are offering tax incentives for advanced biofuels and are attracting new construction and job growth. Thus, there is an extra "homegrown technology" incentive in extending these tax credits for multiple years and in making the credits retroactive to January 1st of this year.