Fuel Marketers Pump Congress for Biodiesel Credit

Fuel Marketers Pump Congress for Biodiesel Credit

Fuel marketers and resellers Monday urged Congress to restore a biodiesel tax credit that expired at the end of 2009, depressing production and raising the price of biodiesel.

In a letter, the coalition pressed Senators Max Baucus, D-Mont., and Charles Grassley, R-Iowa and Representatives Sander Levin, D-Mich., and Dave Camp, R-Mich., to reinstate the credit as part of the American Worker, State and Business Relief Act of 2010.

The $1 per gallon blender tax credit made biodiesel more price competitive with other fuels, the coalition said. Biodiesel production has plummeted 80 percent since the credit expired, and consumers have switched to less expensive fuels, the group said.

"Without an extension of the tax credit, the (biodiesel) production mandate is meaningless and consumer demand for the product erodes," Lisa Mullings, president and CEO of the National Association of Truck Stop Operators, said in the letter.

In addition to NATSO's Mullings, the letter was signed by representatives of the National Association of Convenience Stores, the Petroleum Marketers Association of America and the Society of Independent Gasoline Marketers of America.

Truck stop operators and other fuel retailers "want to continue making investments in biodiesel infrastructure and want to continue selling biodiesel to customers," said Mullings. "But without this tax credit, they can't do that."

Many biodiesel producers have shut down or scaled back production, she said.

Earlier this month, biodiesel facilities in Ralston and Newton, Iowa, were put on "hot idle," meaning that while they weren't closed permanently they were shut down. The owner of the plants, Renewable Energy Group, blamed the loss of the tax credit.

Contact William B. Cassidy at wcassidy@joc.com.