Study: biodiesel tax incentive has economic, environmental benefits


Study: biodiesel tax incentive has economic, environmental benefits

A new study has found that the biodiesel tax incentive benefits the economy and environment.  

Kurt Kovarik is the vice president of federal affairs for the National Biodiesel Board.

“On an annual basis, the economic impact to the economy is $15 billion and the environmental impact, both in terms of reduced carbon emissions as well as reduced particulate matter for clean air is a benefit of about $4.3 billion annual to the United States,” he says.

The current tax credit expires at the end of 2022.

He tells Brownfield the study shows that letting it expire would hurt the economy, production of the fuel, jobs, and the environment.

“Direct and indirect job losses of nearly 10,000 as well as significant losses in greenhouse gas benefits that would be lost if that tax credit were allowed to expire,” he says.

Kovarik says the Build Back Better bill being considered by Congress includes a clean energy tax portion including an extension of Biodiesel Blenders’ Tax Credit.

“We’re hopeful that as Congress continues to discuss utilizing the tax code to support carbon reduction that biodiesel will be at the table and seen as part of the solution,” he says.

The $1 per gallon blenders’ tax credit was created in 2005. Kovarik says it was an effort to spur economic development in rural areas, create alternative energy, reduce dependence on foreign oil, and improve the environment.

The Economic Benefits of the Biodiesel Blenders’ Credit was completed by the Capital Policy Analytics.

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Audio: Kurt Kovarik