ACE applauds biofuel inclusion in ‘big, beautiful bill’

The American Coalition for Ethanol (ACE) has praised the inclusion and extension of the Clean Fuel Production Credit—commonly referred to as Section 45Z—in the final tax and spending package passed by Congress and headed to President Trump’s desk.
ACE CEO Brian Jennings issued the following statement: “We’re grateful to our Congressional champions for their steadfast leadership to support and strengthen the 45Z credit, which is remarkable considering the fact most other IRA-era tax credits were limited or phased-out in the final package.
“While there were other improvements we had hoped to achieve in the final 45Z language, restoring transferability of the credit, removing indirect land use change (ILUC) penalties, and restricting feedstock eligibility to USMCA countries will strengthen the credit from its original version.
“In terms of the credit term, we preferred the House language which would have extended 45Z through 2031, and we also urged Congress to specifically allow low-carbon farming practices to be monetized through 45Z with the feedstock calculator and guidelines USDA has released, but nevertheless ACE remains committed to working with federal agencies to implement the credit in ways that reward on-farm conservation practices and accelerate the use of homegrown, low-carbon biofuels.”
ACE has been working to help monetise low-carbon farming practices in 45Z through their 10-State USDA Regional Conservation Partnership Program (RCPP).
Once farmers participating in the project have implemented reduced-till, 4R nutrient management, or cover crops, land-grant university scientists will collect soil samples and other field-level data about the resulting carbon benefits to better calibrate the GREET model and the USDA FDCIC to generate more reliable carbon scores for farming practices.
The 45Z credit, originally enacted under the Inflation Reduction Act, provides technology-neutral incentives for clean fuels based on lifecycle greenhouse gas emissions.
The final version extends the 45Z credit through the end of 2029—two years beyond its current expiration date of Dec. 31, 2027. It also limits eligibility to fuels made from feedstocks produced or grown in the US, Mexico, or Canada, and revises how lifecycle GHG emissions are calculated by excluding emissions from indirect land use change (ILUC).