Federal Biodiesel Tax Credit Ends

A federal tax credit that provided makers of biodiesel $1 for every gallon expired Friday, and as a result some U.S. producers say they will shut down without the government subsidy, the Associated Press reported.

A one-year extension of the biodiesel tax credit was included in a bill that was approved by the U.S. House recently, but it never made it through the Senate, AP reported, though lawmakers said the tax-credit would be retroactive if approved.

Biodiesel, typically blended with traditional fuel, has over the past few years been the fastest growing fuel among fleet vehicles like buses, snow plows and garbage trucks, but those fleets can shift to traditional fuel when the prices of diesel drops, AP said.

The biodiesel industry is now operating at only 15% of its potential capacity, according to the National Biodiesel Board, largely because the price of traditional diesel has collapsed. There are close to 180 biodiesel plants operating in about 40 states, AP reported.

By Transport Topics

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