Biofuels Incentives: A Summary of Federal Programs (CRS Report for Congress)
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| Release Date |
Revised July 29, 2008 |
| Report Number |
RL33572 |
| Report Type |
Report |
| Authors |
Brent D. Yacobucci, Resources, Science, and Industry Division |
| Source Agency |
Congressional Research Service |
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Summary:
With recent high energy prices and the passage of major energy legislation in 2005 (P.L. 109-58) and 2007 (P.L. 110-140), there is ongoing congressional interest in promoting alternatives to petroleum fuels. Biofuels -- transportation fuels produced from plants and other organic materials -- are of particular interest. Ethanol and biodiesel, the two most widely used biofuels, receive significant government support under this law in the form of mandated fuel use, tax incentives, loan and grant programs, and certain regulatory requirements. The 24 programs and provisions listed in this report have been established over the past 27 years, and are administered by five separate agencies and departments: Environmental Protection Agency, U.S. Department of Agriculture, Department of Energy, Internal Revenue Service, and Customs and Border Protection. These programs target a variety of beneficiaries, including farmers and rural small businesses, biofuel producers, petroleum suppliers, and fuel marketers. Arguably, the most significant federal programs for biofuels have been tax credits for the production or sale of ethanol and biodiesel. However, with the establishment of the renewable fuels standard (RFS) under P.L. 109-58, Congress has mandated biofuels use; P.L. 110-140 significantly expanded that mandate. In the long term, the mandate may prove even more significant than tax incentives in promoting the use of these fuels. The 2008 Farm Bill -- The Food, Conservation, and Energy Act of 2008 -- amended or established various biofuels incentives, including lowering the value of the ethanol excise tax credit, establishing a tax credit for cellulosic biofuel production, extending import duties on fuel ethanol, and establishing several new grant and loan programs. This report outlines federal programs that provide direct or indirect incentives for biofuels. For each program described, the report provides details including administering agency, authorizing statute(s), annual funding, and expiration date. The Appendix provides summary information in a table format.
