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H.R. 1424 (P.L. 110-343), the Emergency Economic Stabilization Act, was signed into law on October 3, 2008. It contained the following biodiesel provisions: • Extends the income tax credits, blenders excise tax credit and the small producer tax credit that make up the biodiesel tax incentive for one year through December 31, 2009. The incentive is currently set to expire on December 31, 2008. • Provides that all biodiesel, regardless of feedstock used to produce the fuel, qualifies for the $1 per gallon biodiesel incentive. Currently, biodiesel produced from yellow grease is eligible for a 50 cents per gallon tax incentive. The effective date for this change in H.R. 1424 (P.L. 110-343) is January 1, 2009. • Closes the so-called “splash and dash” loophole. Splash and dash is where foreign finished fuel is sent to the U.S.; splash blended to claim the tax incentive; and then shipped to a third country for final use. There is clearly no energy or tax policy justification for these transactions, and it has been long-standing NBB policy that the splash and dash loophole should be closed. The legislation approved by the Senate provides that effective May 15, 2008, fuel produced outside the U.S. for use outside the U.S. does not qualify for the biodiesel tax incentive. • Properly defines the $1 renewable diesel tax incentive to exclude co-processed renewable diesel. In H.R. 1424 (P.L. 110-343), this change is effective upon date of enactment, which was October 3, 2008.
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