US may end splash-and-dash biodiesel loophole

18 September 2008 17:07  [Source: ICIS news]

AUSTIN, Texas (ICIS news)--A bill that would extend tax credits for domestic biodiesel blenders but close the so-called “splash and dash” loophole could receive a vote in the US Senate within the week, the National Biodiesel Board said on Thursday.

The bill, which the US House passed earlier in the week, would extend a $1/gal (€0.18/litre) federal tax credit to domestic biodiesel blenders but exclude them from biodiesel produced outside the US and meant for export, National Biodiesel Board CEO Joe Jobe said at the sidelines of the Third Annual Texas Biofuels Conference and Expo.

“The bill has language that says fuel produced outside the country, for use outside the country, no longer gets the credit,” Jobe said.

The provision is meant to close the so-called “splash and dash” loophole, which entails foreign suppliers adding minimal amounts of petro-diesel to B100 biodiesel in the US and then immediately shipping it to sell overseas, taking advantage of tax credits both here and abroad. The practice ultimately led to a European Commission opening an anti-dumping investigation in June.  

“It does appear there was a deal struck by leaders of both sides of the Senate. But with end-of-year silliness, especially during presidential election year, well, we’ll see how it goes,“ Jobe said.

($1 = €0.70)

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Author: Ben Lefebvre
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