Agency: Department of the Treasury
Description:
Tax credit of $1/gallon for biomass-based diesel (biodiesel and renewable diesel) fuel, plus tax credit for alternative fuels
Bill Section:
13201
US Code:
26 USC 40A
New or Existing:
Existing
Potential Cost:
$5,600,000,000
Timeline:
Calendar years 2023-2024, with costs incurred in FY23-25
TCS Notes:
Most biomass-based diesel is derived from soybeans, a food-based crop. Federal supports for biodiesel, such as this tax credit, are duplicative of Renewable Fuel Standard (RFS) mandate which requires U.S. biofuel consumption. There are also no GHG emission reduction requirements. The estimated cost in FY23 is $2.8 billion.