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  • Ron Kotrba

Democratic leaders urged to maintain support for biodiesel, Bioheat® in budget reconciliation

The National Biodiesel Board joined the National Energy & Fuels Institute and other organizations in sending a letter Oct. 26 to House and Senate Democratic leaders asking them to maintain support for biodiesel and Bioheat® fuel as they work to finalize budget reconciliation legislation.

The letter states that “85 percent of the 5 million homes that use liquid fuels for heat and comfort each winter are in the Northeast region from Maryland to Maine. Many retailers that serve these homes are now delivering Bioheat® fuel, which is heating oil blended with biodiesel, an advanced biofuel with 74 percent lower greenhouse gas emissions on average than conventional petroleum. Bioheat® fuel is produced from an array of sustainable feedstocks, including recycled cooking oils and fats and surplus vegetable oils. There are 10 biodiesel producers in the Northeast with a combined annual capacity of 155 million gallons. Their production supports nearly 5,000 full-time jobs, $175 million in annual wages, and $1.2 billion in yearly economic activity. Biodiesel production supports 13 percent of the value of every bushel of U.S. soybeans.”

The organizations are asking specifically for an extension of the biodiesel tax incentive (“Establish long-term certainty for renewable fuel tax incentives to ensure continued growth and adoption of these fuels in the heating sector”); funding to continue USDA’s biodiesel infrastructure cost-sharing grants (“Support downstream biofuel infrastructure investments by including at least $1 billion for ‘Biofuel Infrastructure and Agriculture Product Market Expansion’ in the House Agriculture Committee’s portion of the reconciliation package); and eligibility for biofuel-compatible heating appliances to qualify for energy-efficient property tax incentives (“Allow modern and efficient biofuel-compatible heating appliances to qualify for the bolstered Section 25C tax incentive for installation of energy efficient residential property”).

“Renewable liquid heating fuels support local economies and provide an immediate, low-cost, and low-carbon solution to consumers,” the letter states. “They provide small, multigenerational family businesses, once referred to as ‘heating oil dealers,’ the opportunity to enhance their competitiveness while helping to address climate change. These fuels utilize existing storage and distribution infrastructure and, with minor modifications, work seamlessly in existing appliances to deliver immediate reductions in greenhouse gas emissions—all at little to no additional cost to the consumer. In other words, heating oil customers can help fight climate change without costly conversions of their entire home heating systems to other fuels. Many states now recognize the role renewable liquid heating fuels are playing to help meet ambitious carbon reduction goals. Connecticut, New York, and Rhode Island have enacted laws requiring biodiesel blends in home heating oil. Massachusetts is working to strengthen its current incentive program that rewards heating oil distributors for delivering blends of at least 10 percent biodiesel. Other Northeast states are considering similar policies.”

The letter concludes by stating, “The double-punch of more efficient appliances and greater adoption of renewable liquid heating fuels will deliver immediate and cost-effective solutions that can help achieve the president’s goal of a 50 percent reduction to economywide greenhouse gas emissions by 2030.”

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