The American Soybean Association (ASA) is applauding U.S. Representatives Kenny Hulshof (R-Mo.) and Earl Pomeroy (D-ND.) and their co-sponsors for introducing the Renewable Fuels and Energy Independence Promotion Act.
The bill is key to soybean growers because it would make permanent the biodiesel tax incentive and the small agri-biodiesel producer credits that ASA successfully championed and Congress included in 2004 and 2005 legislation.
"We commend Representatives Hulshof and Pomeroy for their long-term vision for the biodiesel industry that is so important to soybean growers," said ASA President Bob Metz, a soybean producer from West Browns Valley, S.D. "Soybean growers can help America to become more energy secure. By making these tax policies permanent, this legislation gives the biodiesel industry the green light to grow and expand production."
ASA achieved its top legislative goal in 2004 when the biodiesel tax incentive was signed into law that year. In 2005, ASA also achieved its goal when the landmark Energy Bill extended the biodiesel tax incentive through 2008.
"This legislation will help support the price of our soybeans by creating long-term demand for biodiesel made from soybean oil," Metz said. "ASA is urging all soybean growers to contact their Members of Congress and ask them to co-sponsor this legislation. The toll free number for the Congress Operator is 1-888-355-3588."
Growers can also go to www.SoyGrowers.com to use ASA’s Legislative Action Center "to let your voice be heard" by sending e-mail messages to members of Congress.
"Federal policy should strive to reduce our dependence on foreign oil," said Rep. Kenny Hulshof. "Domestically produced renewable fuels must play an integral role in a plan to promote energy independence. If renewable fuels are to displace significant amounts of petroleum as transportation fuel, we must take bold, aggressive steps to achieve this end. Expanded use of biodiesel will help make America more energy independent and the nation as a whole will reap the benefits."
The Hulshof/Pomeroy bill amends the Internal Revenue Code of 1986 to make permanent important incentives for biodiesel and ethanol.
"Renewable fuels are a critical component to our nation becoming more energy independent. By making the tax credits for biodiesel and ethanol permanent, we are providing the stability these emerging industries need to grow," said Rep. Earl Pomeroy. "North Dakota has seen first hand the positive impact these tax credits can have in building these industries, and this bill ensures those same benefits will continue to be available."
In May 2006, ASA announced its biodiesel legislation priorities. ASA stressed the importance of the extension of the volumetric biodiesel tax incentive and small agri-biodiesel producer credit.
Currently, the excise tax is extended for biodiesel and biodiesel mixtures through 2008. The excise tax credit amounts to a penny per percentage point of biodiesel blended with petroleum diesel for "agri-biodiesel," such as that made from soybean oil.
The small agri-biodiesel producer credit is also currently in effect through 2008. It provides producers, with annual capacity not exceeding 60 million gallons, an income tax credit worth 10 cents per gallon on up to 15 million gallons of agri-biodiesel produced in a tax year.
The domestic biodiesel industry is expanding at an exponential rate. Production of biodiesel fuel has grown from 500 thousand gallons in 1999, to more than 150 million gallons projected in 2006. Today, there are 65 operational biodiesel plants, while 50 more are under construction.
ASA is the policy advocate and collective voice of its 25,000 producer-members on domestic and international issues of importance to all U.S. soybean farmers.