Iowa biodiesel production tax credit extended through 2024

By Ron Kotrba | May 26, 2016

In Iowa, at Renewable Energy Group Inc.’s Newton biodiesel plant, Gov. Terry Branstad signed legislation into law May 24 extending and expanding state biodiesel incentives.

The bill, SF 2309, extends a state biodiesel production tax credit through 2024. The production credit, which amounts to 2 cents per gallon on the first 25 million gallons of production per biodiesel plant, was scheduled to sunset Dec. 31, 2017.

The measure also extends and expands a retailer’s credit that provides petroleum retailers an incentive of 4.5 cents per gallon on blends of at least 5 percent biodiesel through next year. Then, from 2018-’24, the incentive drops to 3.5 cents per gallon, but an additional incentive of 5.5 cents per gallon will be in place for biodiesel blends of 11 percent or higher.  

“We are extremely grateful that Governor Branstad and the Iowa legislature appreciate the impact of biodiesel in Iowa and beyond,” said Grant Kimberley, the executive director of the Iowa Biodiesel Board. “Renewable fuels like biodiesel point the way to a more sustainable energy future—and a more independent, home-grown energy future as well. With these additional incentives, Iowa is perfectly positioned to experience even more economic growth in environmentally friendly biofuels.”

Gov. Branstad had previously signed legislation to secure another year of funding for Iowa’s biodiesel and ethanol blender pump program, the Renewable Fuels Infrastructure Program.

Last year Iowa’s biodiesel plants produced a record 242 million gallons of biodiesel. The industry supported more than 3,000 jobs and contributed almost $345 million in GDP for the year, according to the IBB.

 

 
 
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