Representative Beth Van Duyne (R-TX) recently introduced a bill that aims to repeal the Section 45Z clean fuel production credit. The tax credit, established by the Inflation Reduction Act, supports the production of various low-carbon transportation fuels.
The technology-neutral credit is available for numerous biobased and renewable fuels, including sustainable aviation fuel, renewable diesel, ethanol, renewable natural gas, and biodiesel, provided they meet lifecycle greenhouse gas reduction requirements. Fuels must be produced in the U.S. and not emit more than the limit of carbon dioxide equivalent established by the GREET model to qualify for the credit.
Initial guidance on 45Z was released on January 10. The bill introduced on January 16 would repeal the 45Z tax credit, effective on December 31, 2024. Following its introduction, the bill was referred to the House Committee on Ways and Means. Ethanol Producer Dot Com says to date, no other lawmakers have cosponsored the legislation.