Feb 3 (Reuters) - The U.S. Treasury Department on Tuesday issued a proposed rule governing how biofuel makers can access a $1-per-gallon tax credit for low-carbon transportation fuels, including aviation fuel.
The rule was welcomed by biofuel trade groups that said the plan could provide more certainty for producers of ethanol, biodiesel and other products seeking the credit.
>> In Other News: Trafigura Just Bought 6 Years of Jet Fuel Made from Dairy Waste
Make sense of the latest ESG trends affecting companies and governments with the Reuters Sustainable Switch newsletter. Sign up here.
The program, dubbed 45Z, was created under former President Joe Biden's Inflation Reduction Act and was amended last year in President Donald Trump's One Big Beautiful Bill.
Advertisement · Scroll to continue
Changes included allowing for low-carbon fuel produced with feedstocks grown in Canada and Mexico as well as tweaks to the methodology for calculating a feedstock's land use intensity.
"Today’s 45Z proposed rule is a step in the right direction toward providing the clarity and certainty that ethanol producers are seeking," said Geoff Cooper, president and CEO of the Renewable Fuels Association.
He said some questions about the program remained unanswered, however, including the makeup of a revised climate model that could impact fuel eligibility and the implementation of foreign feedstock prohibitions.
Representatives for soy farmers also welcomed the rule.
"Updating federal biofuel policies to prioritize soy-based fuels is a key ASA priority, and we applaud Treasury for this action which will help build domestic markets for U.S. soybeans," said Scott Metzger, president of the American Soybean Association.
Subscribe to the newsletter
Daily decarbonization data and news delivered to your inbox
Follow the money flow of climate, technology, and energy investments to uncover new opportunities and jobs.
Latest issues
-
Why Bill Gates Bet $40M on This Carbon Capture Lab
Inside This Issue 🧪 Why Bill Gates Bet $40M on This Carbon Capture Lab ⛏️ Max Power Prepares to Drill Second Natural Hydrogen Well as Program Expands 325 km SW of Lawson Discovery 💰 Trafigura-Back...
-
Honda Repositions Hydrogen Strategy After Michigan Pivot
Inside This Issue 🚪 Honda Exits Fuel Cell Partnership as Hydrogen Pivots ♻️ A Breakthrough That Turns Exhaust CO2 Into Useful Materials ✈️ FedEx Takes Delivery of SAF at Dallas Fort Worth and New ...
-
QIMC Hits 5,558 ppm Hydrogen in Nova Scotia Discovery
Inside This Issue 🔍 QIMC Hits 5,558 ppm Hydrogen in Nova Scotia Discovery 🏗️ Haffner Energy Launches the C-iC Modular Units Line to Unlock Financing for Mid-Sized Biofuel Projects 🌱 CF Industries,...
Company Announcements
-
ExxonMobil Faces Antitrust Claims Over Blue Ammonia Project's CO2 Pipeline Access
ExxonMobil and its Denbury subsidiary are facing expanded antitrust claims in Texas after a blue ammonia developer alleged the oil major used its control over carbon dioxide pipelines to block a co...
-
The Civil Aviation Authority of Singapore (CAAS), the Singapore Sustainable Aviation Fuel Company Ltd. (SAFCo) and nine companies have launched Singapore's first trial for central procurement of vo...
-
TORONTO, Feb. 3, 2026 /CNW/ - PaceZero Capital Partners ("PaceZero") announced today that it entered into a committed credit facility with Alchemy CO₂ ("Alchemy"). The funding will support Alchemy'...
-
EU Sets World’s First Voluntary Standard for Permanent Carbon Removals
Today, the European Commission adopted the first set of methodologies under the carbon removals and carbon farming (CRCF) Regulation to certify activities that permanently remove CO2 from the atmos...