US Blocks Tax Credit for Foreign Biofuel Supplies
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The U.S. is moving to curb imports of used cooking oil, preventing foreign supplies used to make biofuels from qualifying for a lucrative tax credit.
In long-awaited guidance, U.S. Treasury signaled that fuels made with foreign-sourced supplies won’t be allowed under the so-called GREET model, a tool used to determine the full sweep of greenhouse gases emitted from the transportation and energy industries.
The move comes after a flood of supplies from China reached U.S. shores at cheaper prices than soybean oil produced locally. The decision is a win for American farmers, which have been counting on a biofuel boom to sell their crops.
“This tax credit is essential to U.S. competitiveness and to reduce emissions in the transportation sector with more affordable, cleaner fuel,” U.S. Deputy Energy Secretary David Turk said in a statement. “The final guidance released today provides clarity and certainty to America’s world-leading biofuel industry.”
Fuel made with UCO is highly valued in low-carbon fuel markets like California because of its relatively small carbon footprint.
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