Sponsor
Marsha Blackburn
Senator · R-TN
Senator · R-TN
The bill sustains tax incentives and coordinates credits to keep demand for biodiesel and renewable diesel (supporting cleaner fuels and preventing double-dipping), but does so at the cost of reduced federal revenue and added compliance and transition uncertainty for fuel suppliers.
Producers and blenders of biodiesel and renewable diesel: retain eligibility for federal income and excise tax credits through post-2029 sales, sustaining demand and revenue for renewable-fuel suppliers.
Taxpayers and fuel-market overseers: the bill coordinates credits to prevent double-dipping between Section 45Z and existing excise/income credits, reducing improper payouts and simplifying eligibility rules.
Consumers and fleets relying on diesel: continued policy support for biodiesel and renewable diesel helps maintain availability of cleaner-burning diesel substitutes that can lower lifecycle emissions versus petroleum diesel.
Taxpayers broadly: extending these tax credits reduces federal revenue and therefore represents an ongoing fiscal cost unless offset elsewhere.
Fuel suppliers and taxpayers: the bill's coordination rules (including retroactive application to the enactment date) add complexity and will likely increase compliance burdens and require IRS administrative guidance.
Producers and blenders of renewable fuels: prioritizing Section 45Z over existing excise credits could alter profitability calculations and create transitional uncertainty for some energy companies.
Based on analysis of 2 sections of legislative text.
Extends biodiesel and renewable diesel excise and income tax credits past 2029 and bars claiming those credits together with the Section 45Z clean fuel production credit for the same fuel.
Extends federal biodiesel and renewable diesel excise and income tax credits so those credits remain available for fuel sold or used after December 31, 2029, and adds rules to prevent taxpayers from claiming both these biodiesel/renewable diesel credits and the Section 45Z clean fuel production credit for the same fuel. The bill revises expiration language, sets the biodiesel excise credit to zero when a Section 45Z credit is claimed, and bars a Section 45Z credit if certain biodiesel excise credits apply, with the changes effective for fuel sold or used on or after enactment.
Official title: Amend the Internal Revenue Code of 1986 to extend biodiesel and renewable diesel incentives, and for other purposes.
Introduced April 28, 2026 by Marsha Blackburn · Last progress April 28, 2026