The 25×25 National Steering Committee is taking a critical step of engagement this week, sending a letter calling on House and Senate leaders to expedite passage of a biodiesel tax credit that expired December 31. Signed by Steering Committee co-chairs Bill Richardson and Reed Smith, the letter asserts that there is an urgent, time sensitive need to retroactively extend the biodiesel tax incentive. The letter cites the severe market disruption that has occurred and is asking Congressional leadership to provide a multi-year extension of the tax incentive.
This request comes at a time when the International Energy Agency is predicting the highest global oil demand in 2010. It could be the highest level in three years, fed by rising consumption in emerging Asian economies. Meanwhile the Department of Energy's Energy Information Administration projects the price of crude oil to hover around $80 per barrel and more over the next two years, and gas prices to head toward $3 per gallon.
According to the 25X25 National Steering Committee, biodiesel is a renewable, environmentally friendly diesel replacement fuel that is produced from vegetable oils, animal fats, and waste greases. The $1-per-gallon biodiesel tax incentive helps encourage the domestic production and use of biodiesel by making the fuel price competitive with petroleum diesel fuel. The committee notes that the incentive is structured in a unique manner that allows the value of the credit to be reflected in the market price of the fuel.