Biofuel tax incentives don't pass muster in Senate vote

By Holly Jessen | March 14, 2012

A March 13 vote defeated an amendment that would have extended key biofuels tax credits–prompting disappointed reactions from the Renewable Fuels Association, Advanced Ethanol Council and Growth Energy.

The amendment was defeated in a 49 to 49 vote, meaning the Cellulosic Biofuels Producer Tax Credit, the Accelerated Depreciation Allowance for Cellulosic Biofuel Plant Property and the Alternative Fuel Infrastructure Tax Credit were not extended and could sunset. Brooke Coleman, executive director of AEC called it a “missed opportunity” and Tom Buis, CEO of Growth Energy, likened it to “losing a battle but not a war.”

Sen. Debbie Stabenow, D-Mich., crafted the amendment, which would have extended the $1.01 per gallon production tax credit for cellulosic ethanol through 2014. It also would have extended the tax incentive through the end of 2012 to encourage retail gas stations to install blender pumps and flex-fuel pumps.

If passed, the Senate amendment would have helped provide greater choice in motor fuels in the U.S. and encouraged development of advanced biofuels, such as cellulosic ethanol. “Ethanol is trading a dollar cheaper than gasoline, and the more American-made ethanol we get into the market the more affordable fuel becomes, the more jobs we create, the more cleaner our air is, and the more energy independent our nation becomes," Buis said.

AEC appreciates Stabenow’s efforts and will continue to work toward getting the tax incentives passed, Coleman said. He also pointed out that 49 of the voting senators recognized the importance of the amendment with “yes” votes. “The underlying reality is the lack of policy certainty is driving clean energy investment overseas and putting the United States behind the eight ball when it comes to clean energy development,” he added.

RFA agreed, adding that if passed, the amendment would have helped America reduce its reliance on imported oil and create jobs. “In the face of record gas prices for this time of year and the very real possibility for $5 gas, I urge Congress to move swiftly to pass extensions of these tax incentives and accelerate America’s break with foreign oil,” said President and CEO Bob Dinneen.