House Bill Would Tax LNG Based on Energy Output

A House bill would tax liquefied natural gas based on energy output rather than a per-gallon basis, according to its co-sponsor, Rep. Mac Thornberry (R-Texas).

The federal excise tax on LNG and diesel is set at 24.3 cents per gallon, but it takes 1.7 gallons of LNG to produce the same amount of energy in a gallon of diesel fuel, according to Thornberry.

“Companies are already beginning to make the switch towards natural gas vehicles, and this bill will knock down a significant barrier preventing companies from further harnessing this domestic energy source,” said Thornberry.

A Senate companion bill is expected to be introduced by Sens. Michael Bennet (D-Colo.) and Richard Burr (R-N.C.), according to Thornberry.

NGVAmerica, an advocacy group for greater natural-gas use in transportation, said it commends the measure to accelerate the switch to domestic natural gas.