REG idles 2 biodiesel plants, lays off workers

By Ron Kotrba | March 23, 2010
Posted April 1, 2010

The largest U.S. biodiesel company, Renewable Energy Group Inc., idled two of its plants and laid off 22 workers on March 29 and March 30 due to the continued lapse of the biodiesel tax credit.

The company halted production at its 12-MMgy REG Ralston plant and the newly acquired 30-MMgy REG Newton facility, both in Iowa.

Since Jan. 1, REG and its independent network plants have laid off off 45 percent of their staff "as a direct result of the tax credit lapse," the company stated, and employees not laid off have taken pay cuts.

On March 31, REG Chairman and CEO Jeff Stroburg sent a letter to U.S. Rep. Sander Levin, chairman of the House ways and means committee.

"It is with great urgency that I contact you," Stroburg writes. "Demand for biodiesel is extremely limited because our customers are no longer taking the risk of purchasing biodiesel without the tax credit. Manufacturing plants have idled. This dire situation is occurring not only in Iowa, but all over the country."

REG has meetings arranged with Sen. Dick Durbin and Rep. Steve King to visit Western Iowa Energy in Wall Lake, Iowa, to talk one-on-one about the tax credit with the legislators.

On March 10 the Senate passed the American Workers, State and Business Relief Act, including H.R. 4213 containing the biodiesel tax credit. As of April 1, the bill currently awaits action by the House ways and means committee. Congress returns from its Easter break on April 12 and will remain in session until Memorial Day, a period of time during which many biodiesel producers are relying on legislative action for their survival.

A Facebook page, "Reinstate the Biodiesel Blenders' Tax Credit," has been set up, and biodiesel advocates are asked to become a fan of the page.
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