Tucked into the “fiscal cliff bill” approved Tuesday night were a few smaller issues, which may have a big impact on Iowa.
One of them is an extension of the bio-diesel tax credit.
“It’s really hard to compete with petroleum that continues to get billions and billions of dollars of tax subsidies. With that tax credit back in place for 2013, we look for another record production for biodiesel,” said Monte Shaw, with the IRFA.
The first place many people will start to notice that change is at the pumps.
Monte Shaw with the Iowa Renewable Fuels Association said drivers will see lower fuel prices because of the added competition in the market place that this tax credit will produce. That competition is also good news for employees in the biodiesel industry. More demand mean more job stability, and possibly even a need for more employees.
But officials said it’s not only the biodiesel industry that will feel the benefits.
“It’s good because it does add value back to the farmer, back to the producer, of those agricultural products,” said Gary Haer, with the Renewable Energy Group, “They know with certainty that our industry is going to be continuing to consume feedstock from their production, whether its livestock production and meat producing that comes from that or ethanol production and the corn oil we use or the soy bean oil that we use.”
Also included is a tax break for cellulosic ethanol production. Right now, only a few cellulosic ethanol plants are up and running in Iowa, but industry officials say the tax credit could change that. There are currently three projects underway, that could be brought online sooner than scheduled, possibly even within 2013.