Illinois supports state B11 tax incentive through 2018

Illinois has it right when it comes to incentivizing long-term biodiesel production and market growth as it has extended its unique, highly effective biodiesel tax credit through 2018.
By Ron Kotrba | December 14, 2011

Earlier this week the Illinois House passed SB 397, extending the state’s biodiesel tax credit for five years through 2018, and yesterday in a full vote the Senate voted 44-9 to pass it as well. The tax credit was previously due to expire at the end of 2013. The incentive gives complete fuel tax exemption for any blend of biodiesel greater than 10 percent, making Illinois a unique state where B11 is found everywhere.

Last summer when I made a semi-cross country trip from North Carolina to North Dakota in a one-ton diesel dually, any random truck stop in Illinois I stopped at was selling B11, the highest state-sanctioned, ubiquitous blend of biodiesel sold anywhere in the U.S. Obviously, the incentive works. And it’s good to see Illinois’ legislature supporting biodiesel, even if the nation’s House and Senate cannot do the same.

According to the Illinois Soybean Association, since 2003, the year the Illinois sales tax exemption for biodiesel went into effect annual biodiesel production capacity in the state of Illinois has increased from 20 million gallons to a record 188 million gallons in 2010.

REG, the nation’s largest biodiesel producer, weighed in on the news. “Since Illinois’ inception of the B11 blending credits in 2004, more biodiesel has been blended in Illinois annually than in any other state,” said Daniel J. Oh, president and CEO of REG. “By extending the biodiesel tax abatement for B11 and higher blends through 2018, the Illinois legislature showcases its commitment to more than 1,500 green collar jobs in the state.”

REG markets biodiesel from its REG Danville (45 MMgy capacity) and REG Seneca (60 MMgy capacity) facilities as well as several Chicago-area terminal locations.