08 February 2010 19:24 [Source: ICIS news]
GRAPEVINE, Texas (ICIS news)--US biodiesel sources said on Monday that they are pushing Congress to include a crucial blending tax credit extension as part of a jobs-stimulus package that they hope will receive a vote within a week.
National Biodiesel Board (NBB) CEO Joe Jobe said the jobs stimulus package that the Obama administration is pushing for could contain language that would re-instate the $1/gal blending tax credit that biodiesel producers need to compete with petroleum diesel pricing.
"We could see movement this week on a jobs package containing the extender legislation," Jobe said at the 2010 National Biodiesel Conference. "Our main goal is to get the credit reinstated, retroactive, as soon as possible."
The industry is also lobbying for the credit to be valid for five years instead of having to be re-approved on an annual basis in Congress.
The lapse of the credit, which expired in December, meant that producers and blenders were at a pricing disadvantage when competing with petroleum-based diesel. Unable to sell material, producers such as Iowa Renewable Energy and Western Dubuque Biodiesel have laid off employees, while others mothballed their plants.
Although the credit has only been inactive for less than two months, its loss caused damage to an industry where most producers had a thin cash cushion. Producers said that the damage will be irreversible for some unless the extension covers the first part of 2010.
"Without that tax credit being retroactive, there's still problems," said Jonathan Phillips, chief investing officer at Renewable Biofuels (RBF) of Port Neches, Texas.
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