U.S. biodiesel production reached a new monthly high of 81 million gallons in June according to the latest Environmental Protection Agency (EPA) statistics.

This marks the third consecutive month of record volumes and continues a remarkable turnaround in which biodiesel production in the first half of 2011 has already eclipsed production for all of 2010.

The new numbers — coming after Congress reinstated the biodiesel tax incentive this year — demonstrate the power that strong domestic energy policy can have in helping create jobs and economic activity.

Despite the weak economy, the biodiesel industry is on track to produce at least 800 million gallons this year, more than double the 315 million gallons of biodiesel produced last year, when Congress allowed the biodiesel tax incentive to temporarily lapse.

According to a recent economic study, this year’s rejuvenated production will support more than 31,000 U.S. jobs and generate income of nearly $1.7 billion to be circulated throughout the economy.

"Policy makers should take a look at our experience over the last couple of years," said National Biodiesel Board CEO Joe Jobe.

"It's a textbook case in how sound energy policy equates to sound economic policy. Congress should not allow the biodiesel tax incentive to expire again at the end of this year. In this kind of economy, we need every tool we have."

Since the introduction of the $1-per-gallon biodiesel tax credit in 2005, U.S. biodiesel production climbed steadily until 2010, when Congress allowed it to lapse temporarily as the healthcare debate overshadowed other issues.

Production immediately plummeted from a record of about 700 million gallons in 2008 to about 315 million gallons in 2010.

The tax credit is again slated to expire in December of this year, threatening industry momentum and jobs.

The American Soybean Association applauds the introduction by Senators Maria Cantwell (D-Wash.) and Charles Grassley (R-Iowa) of S. 1277 to extend the tax incentive for three years, and by Reps. Aaron Schock (R-Ill.) and Collin Peterson (D-Minn.) of their similar bill, H.R. 2238, in the House.