Renewable diesel credit stalls in US Senate

23 October 2007 22:44  [Source: ICIS news]

BRUSSELS, Belgium (ICIS news)--Efforts to eliminate the Coproduced Renewable Diesel (CRD) credit by the US oleochemical and biodiesel industries have stalled in the Senate, an industry official said on Tuesday.

CRD is diesel fuel mixed with small amounts of biomass in petroleum refining processes. The credit has been criticised by the Soap and Detergent Association (SDA) and the National Biodiesel Board (NBB) because of its $1/gal tax credit eligibility from the Internal Revenue Service (IRS).

“Tallow prices have already doubled because of biofuels. Our goal is to assure equitable access to domestic tallow supply on the part of the US soap and oleochemical industries,” said Dennis Griesing, vice president of government affairs at the SDA.

Griesing spoke at the ICIS Global Oleochemical Conference in Brussels. The two-day event ends on Wednesday.

Instead of eliminating the credit, the US Senate is considering a proposal that would cap the credit at 60m gal/facility, Griesing said

“The repeal has passed the US House of Representatives in its energy bill, but the Senate proposal in its farm bill doesn’t help us at all. We are hoping to have this issue resolved by the end of the year,” Griesing said.

According to the SDA, the credit repeal has strong support, since some consider it a corporate subsidy for large oil companies.

ConocoPhilips is actively seeking the CRD credit through its proposed joint venture with Tyson Foods.

The joint venture will produce 250m gal/year of renewable diesel made with animal fats. The SDA said Tyson could divert 50% of its fats to the project at full production.

By: Doris de Guzman
+1 713 525 2653

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