Clean Fuels Seeks Added Clarity in Final 45Z Clean Fuel Production Credit Rules

WASHINGTON, DC - Today, Clean Fuels Alliance America Vice President of Federal Affairs Kurt Kovarik testified at a public hearing on Treasury's proposed rule for the 45Z Clean Fuel Production Credit. Clean Fuels again expressed appreciation for Treasury's responsiveness to industry input and urged the agency to provide additional certainty through timely final rules and updates to the 45ZCF-GREET model.

"We greatly appreciate the proposed regulations addressing qualified sales sold for use in a trade or business, transportation fuel and it being suitable for use, defining a qualified facility, as well as stating the allowance of the tolling relationship," Kovarik stated during the testimony. "While the Proposed Regulations provide much-needed market certainty for biodiesel and renewable diesel producers, we are requesting additional clarity in some areas. Specifically, for instance, we are awaiting publication of the modified 45ZCF-GREET model. We would also appreciate additional guidance as to how to apply the credit to fuel produced prior to publication of the proposed rule and further clarity on the Prevailing Wage and Apprenticeship requirements as they relate directly to 45Z."

Clean Fuels' testimony specifically asked for additional clarity on:

• Renewable heating fuel as an example of a qualifying use of biodiesel or renewable diesel.
• The term "single production line" as it relates to qualified facilities defined to apply specifically to production of fuel and not processing of feedstocks in an integrated facility.
• Safe harbors and their application to fuel produced in 2025.
• The definition of "qualified facility" and "alteration or repair" under the Prevailing Wage and Apprenticeship rules to be consistent with other provisions in the tax code.

Clean Fuels also requested timely action on implementation, including:

• Updates to the 45ZCF-GREET model during the current tax year to include changes passed by Congress that became effective at the start of the year.
• Providing farmers maximum flexibility for on-farm practices and feedstocks in the FD-CIC module for 45ZCF-GREET.

Kovarik added, "Producers are grateful that Congress adopted beneficial changes to the 45Z credit last July through the One Big Beautiful Bill. Taxpayers now need certainty that those changes can be claimed throughout the year. That requires publication of an updated 45ZCF-GREET model by DOE. Increased certainty will help achieve Congress' goals of producing more domestic energy and supporting farmers with domestic market opportunities."

Contact: Paul Winters, [email protected].

ABOUT CLEAN FUELS ALLIANCE AMERICA

Made from an increasingly diverse mix of resources such as recycled cooking oil, soybean oil, and animal fats, the clean fuels industry is a proven, integral part of America's clean energy future. Clean Fuels Alliance America is the U.S. trade association representing the entire biodiesel, renewable diesel and sustainable aviation fuel supply chain, including producers, feedstock suppliers and fuel distributors. Clean Fuels receives funding from a broad mix of private companies and associations, including the United Soybean Board and state checkoff organizations.

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