Fuel retailers express ‘serious concern’ with section 45Z proposed rules

NATSO, representing truck stops and travel plazas, SIGMA: America’s Leading Fuel Marketers, and the National Association of Convenience Stores expressed serious concern with the section 45Z clean fuel production credit Feb. 3, after the U.S. Department of the Treasury issued its proposed rules for the incentive.  

The treasury department was tasked with writing guidelines that would create a viable regulatory framework for 45Z and bolster the flailing U.S. biofuels market.  

“But years of regulatory reviews, public comments, copious stakeholder input and congressional reevaluation can’t alter the fact that 45Z is a giant step backward for American biofuel policy,” NATSO stated. “NACS, NATSO and SIGMA, which represent 90 percent of retail fuel sales, urge Congress and the administration to support simpler biofuel policies that would quickly reinvigorate biodiesel consumption and higher ethanol blends while enhancing the economy and energy market security.”  

David Fialkov, the executive vice president of government affairs for NATSO and SIGMA, said, “As Americans are navigating affordability challenges, now would be a great time to reinstate a tax policy that actually lowers the price consumers pay at the pump. Although the treasury department has done its best to make lemonade out of lemons, 45Z simply will not lower fuel prices. To add insult to injury, today’s proposed rule will not even improve demand for biofuels, nor will it generate meaningful support for American farmers by increasing demand for corn or soybeans.”  

Fialkov continued, saying, “45Z doesn’t help farmers and it doesn’t help consumers. It is past time for lawmakers and regulators to acknowledge that 45Z is too complicated and flawed and it should be replaced with simpler tax incentives that lower fuel prices and support American farmers. How much longer should farmers be expected to wait before 45Z begins delivering benefits for them? We simply can’t afford to continue walking down this path when better, simpler solutions exist.” 

Matt Durand, NACS deputy general counsel, added, “The transition away from the biodiesel tax credit to the 45Z production credit instituted a catastrophic decline in biofuels consumption that hurts the economy. The Trump administration inherited this unworkable mess. Congress can fix it by bringing back the biodiesel tax credit, which has a proven track record of delivering lower prices to consumers while benefitting farmers and biofuel producers.” 

NATSO, SIGMA and NACS urged the administration to pursue more meaningful and measurable biofuel policies—such as reinstating the biodiesel tax credit—that can quickly revive biodiesel consumption and mitigate the damage caused by 45Z while enhancing the economy and energy-market security.  

In 2025, biodiesel consumption plummeted to 960 million gallons through the end of October from more than 2 billion gallons in 2024.  

Newly released EPA data underscores the continued downward spiral of domestic biofuel consumption, according to NATSO.  

Tradable credits known as renewable identification numbers (RINs) used to demonstrate compliance with the Renewable Fuel Standard dropped 22 percent for biodiesel in 2025 compared with the prior year.  

Ethanol RINs also declined, further highlighting that 45Z is not providing support for farmers. 

“Today’s proposal from treasury underscores the need to reinstate the biodiesel tax credit, which is more robust and transparent within the fuel value chain, allowing fuel retailers to pass meaningful savings along to consumers,” NATSO stated.  

NATSO, SIGMA and NACS said they look forward to working with the administration and Congress on biofuel policies aimed at advancing the U.S. fuel supply and U.S. energy markets for the benefit of American consumers.