New Senate bill aims to lower diesel costs and support farmers
Several national fuel and agriculture organizations have welcomed the introduction of new legislation aimed at supporting the biodiesel industry and easing fuel costs. The Consumer Relief and Opportunities for Producers Act, introduced in the U.S. Senate, would temporarily restore the Biodiesel Blenders’ Tax Credit at a rate of one dollar per gallon.
"We commend Senator Blackburn for her commitment to strengthening America's energy markets through a reinstatement of the Biodiesel Blenders' Tax Credit," said NATSO President and CEO Max McBrayer. "Renewing the Biodiesel Blenders' Tax Credit would help bring down the price of diesel in many markets throughout the United States, which would help American consumers navigate the affordability challenges that many of them are currently experiencing."
The proposed legislation would reinstate the credit for six months through May 31, 2026. Under the plan, fuel blenders would be allowed to choose between the reinstated Biodiesel Tax Credit or the Clean Fuel Production Credit known as 45Z. Industry groups say this flexibility would help stabilize fuel markets during a period of uncertainty.
"We appreciate Senator Blackburn for her leadership in restoring the longstanding Section '40A' Biodiesel Blenders' Tax Credit, which has a proven track record of increasing biofuel production and lowering fuel prices at the pump," said Matt Durand, Deputy General Counsel for NACS. "'40A' worked because it was straightforward and transparent. Fuel retailers have been flying blind without it, and the market is in distress amid such largescale uncertainty."
Supporters of the bill say restoring the biodiesel credit would help reduce diesel prices in many regions. Lower diesel costs would benefit trucking companies, fuel retailers, and consumers while easing pressure on farmers who rely on strong biofuel demand for crops such as soybeans.
Industry leaders noted that the expiration of the biodiesel tax credit at the end of 2024 led to higher diesel prices and a sharp decline in biodiesel use. Biodiesel consumption dropped significantly in 2025, placing strain on biofuel producers and the broader agricultural value chain.
The bill has received strong backing from organizations representing fuel retailers, truck stops, convenience stores, heating fuel providers, and biofuel refiners. These groups say the previous biodiesel credit was simple, transparent, and effective in encouraging fuel blending and production.
Supporters also raised concerns about the Clean Fuel Production Credit, stating that its complexity and lack of finalized regulations have created uncertainty for fuel markets. Without clear guidance, fuel retailers have struggled to plan investments or increase biodiesel blending.
"SABR applauds Sen. Blackburn for her leadership in introducing the BTC extension in the Senate," said SABR CEO Joe Jobe. "If passed by Congress, this policy would provide desperately needed relief to the biodiesel industry and all of the other industries that biodiesel benefits in the value chain. This includes farmers who are experiencing an economic crisis in agriculture right now."
"Reliable and affordable supplies of biodiesel and renewable diesel are a top priority for America's heating oil dealers, who serve nearly 5 million homes across the country. NEFI is therefore proud to endorse the Consumer Relief and Opportunities for Producers Act," said NEFI President and CEO Jim Collura. "Enactment of this bill would support our mostly small family businesses transition to renewable liquid heating fuels, which offer a lower cost and more immediate solution to reduce building emissions and contribute to regional energy security and diversity."
When the biodiesel tax credit was active, the industry expanded from about 100 million gallons in 2005 to more than 2 billion gallons by 2024. Supporters believe restoring the credit would provide critical relief as the industry awaits clarity on long-term biofuel policy.
The legislation is co-sponsored by another U.S. senator and is viewed as a short-term solution to support farmers, fuel suppliers, and consumers while strengthening domestic energy markets.
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