Recent developments on Capitol Hill have put the biofuels industry in a prime position to begin 2013. The budget approval for military biofuels, Tax Extenders Package, and Algae Tax Credit not only show Congressional support for the industry but could also help to foster development and innovation and attract investment.
$100 Million Added to the Defense Production Act
The Senate Appropriations Committee added $100 million to the Defense Production Act in its 2013 budget. This measure will support funding for the Navy’s proposed military biofuels program that will “build production capacity for critical defense-related initiatives."
Key Energy Efficiency and Biofuel Tax Credit Provisions
The Senate Finance Committee also made changes to the Family and Business Tax Cut Certainty Act of 2012, adding energy efficiency and biofuel tax credit provisions. These provisions include:
- The Cellulosic Biofuel Producer Tax Credit
- The Accelerated Depreciation Allowance for Cellulosic Biofuel Plant Property
- Clean Fuel Vehicle Refueling Property Credits
- Two-year extension of the R&D Tax Credit
- Extension of the $1 per gallon Biodiesel Blender’s Credit
- Added parity for algal biofuels as part of the Tax Extenders Package
Additionally, the Master Limited Partnerships Parity Act of 2012 has been introduced in Congress and if passed would extend to renewable energy developers the same type of tax incentives now available to oil, gas and coal project developers.
While these measures still await approval by the full Senate, they have already generated buzz within the industry as they indicate bi-partisan support for the advancement of the biofuels sector.