REG-run biodiesel plants undergo layoffs on US tax credit delay

01 February 2010 22:08  [Source: ICIS news]

HOUSTON (ICIS news)--Two biodiesel plants operated by Renewable Energy Group (REG) have laid off staff and cut pay for remaining employees as the US industry suffers from a government delay in renewing tax credits, REG said on Monday.

Twenty-one people were cut from Iowa Renewable Energy and Western Dubuque Biodiesel, both in Iowa, REG spokeswoman Alicia Clancy said.

REG manages refining operations at both plants for third-party owners, but does not make employment decisions at either, Clancy said. The board of directors at each plant made the choices about layoffs and pay cuts, she added.

“Those layoffs were a direct result of the tax credit not being extended,” Clancy said. 

REG is the largest supplier of US biodiesel, operating and managing nine refineries with a combined output of about 300m gal/year of the renewable fuel.

The biodiesel industry has stopped production almost completely as the government has delayed extending the $1/gal blending tax credit that ended in December.

Producers are also waiting for the US Environmental Protection Agency (EPA) to announce updated renewable fuel standards (RFS2) that would call for 1bn gal/year of biodiesel to be blended into the nation’s fuel supply by 2012, a move the industry has said it needs to spur demand.

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By: Ben Lefebvre
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