RFA applauds passage of One Big Beautiful Bill Act

In Washington, with the passage of the One Big Beautiful Bill Act, the Renewable Fuels Association applauded the inclusion of several key tax provisions that will enhance the role of the U.S. ethanol industry in contributing to American energy security and innovation.

Specifically, the OBBBA includes the following improvements to the 45Z Clean Fuel tax provision:

·      Extends 45Z by two years, to the end of 2029.

·      Restricts eligibility for 45Z to fuels made from feedstocks grown in the U.S., Canada, and Mexico.

·      Retains full transferability throughout the term of the 45Z credit.

·      Harmonizes indirect land use change emissions with actual data and evidence, resulting in zero ILUC penalty for corn ethanol.

Other key ethanol-related provisions in the budget reconciliation package include:

·      Retains key enhancements to 45Q previously made in the Inflation Reduction Act and allows other carbon uses like enhanced oil recovery to qualify for equal credit values.

·      Reinstates RD/RE immediate expensing provision that expired in 2022 under the Tax Cuts and Jobs Act.