What's Happening?
U.S. farm organizations are advocating for progress on two key federal policy measures: year-round E15 fuel and the 45Z Clean Fuel Production Tax Credit. The National Corn Growers Association (NCGA) has
long prioritized E15, a 15% ethanol-blended fuel, but recent efforts for its implementation have fallen short. The 45Z tax credit, established by the Inflation Reduction Act of 2022 and extended by the One Big Beautiful Bill Act, aims to support low-emission transportation fuels. However, delays in releasing full guidance have negatively impacted the bio-based diesel industry, with domestic production declining significantly in 2025.
Why It's Important?
The E15 and 45Z policies are crucial for the U.S. biofuel industry, which plays a significant role in the agricultural commodity market. The 45Z tax credit is designed to incentivize the production and sale of low-emission fuels, supporting the transition to cleaner energy sources. However, the lack of clear guidance has hindered the industry's growth, affecting farmers and producers reliant on biofuel markets. Progress on these policies could enhance energy independence, reduce emissions, and provide economic benefits to rural communities.
What's Next?
Farm organizations continue to push for policy clarity and implementation of E15 and 45Z. The NCGA and other stakeholders are likely to increase advocacy efforts to ensure these measures are prioritized by policymakers. The outcome of these efforts will significantly impact the biofuel industry's future, influencing investment decisions and production capabilities. As the industry awaits further guidance, stakeholders are closely monitoring developments to adapt their strategies accordingly.
