The U.S. Senate Finance Committee has passed, by a bipartisan vote of 19-5, the Family and Business Tax Cut Certainty Act of 2012, which includes extensions to key biofuel tax credits. According to the Advanced Biofuels Association, the committee's decision to include these provisions is a major victory for the biofuels industry.
A summary of the bill released by the Senate Finance Committee notes the following biofuel-related provisions:
Cellulosic biofuels producer tax credit. Under current law, facilities producing cellulosic biofuel can claim a $1.01 per gallon production tax credit on fuel produced before the end of this year; the bill would extend this credit through 2013. The bill also expands the definition of qualified cellulosic biofuel production to include algae-based fuel.
Incentives for biodiesel and renewable diesel. The bill extends for two years, through 2013, the $1.00 per gallon tax credit for biodiesel, as well as the small agri-biodiesel producer credit of $0.10 per gallon. In addition, the bill extends through 2013 the $1.00 per gallon tax credit for diesel fuel created from biomass.
Cellulosic biofuels bonus depreciation. Under current law, facilities producing cellulosic biofuel can expense 50% of their eligible capital costs in the first year for facilities placed in service by year-end; the bill would extend this bonus depreciation through 2013.
‘Today's Senate Finance Committee action is a victory for the biofuels industry, and one we have been working toward for quite some time,’ said Michael McAdams, president of the Advanced Biofuels Association. ‘The Senate Finance Committee's work is a strong show of continued bipartisan support for our industry. Today's vote is a signal to the marketplace that the federal government is committed to tax support for this industry.’
According to the Advanced Biofuels Association, the cellulosic biofuels producer tax credit and the accelerated depreciation allowance for cellulosic biofuel plant property are seen as key measures to the ongoing development of the domestic advanced biofuels industry.
‘These two critical tax incentives will lead the way to the creation of more commercial plants across the country, which ultimately results in more jobs and cleaner energy,’ McAdams concluded.