Biodiesel Tax Incentives Extended

The Bailout Bill approved by the House of Representatives today (officially known as H.R. 1424, the Emergency Economic Stabilization Act) would extend certain tax incentives that directly affect alternative energy production. President Bush is expected to sign the bill into law soon.

Specifically, according to The Biodiesel Bulletin, H.R. 1424 will:

1) Extend the biodiesel tax incentive for one year through Dec. 31, 2009.

2) Allow all biodiesel to qualify for the $1 per gallon biodiesel incentive. (Currently, biodiesel produced from yellow grease is eligible for a 50 cents per gallon tax incentive.)

3) Close the so-called "splash-and-dash" loophole. Splash-and-dash is where foreign finished fuel is sent to the U.S.; splash-blended to claim the tax incentive; and then shipped to a third country for final use. Effective May 15, 2008, fuel produced outside the U.S. for use outside the U.S. does not qualify for the biodiesel tax incentive.

4) Redefine the biodiesel incentive to exclude co-processed renewable diesel.