The National Oilseed Processors Association (NOPA) and American Soybean Association (ASA) are backing new Senate legislation that reinforces a U.S.-first approach to biofuel tax credits. The revised text of the 45Z Clean Fuel Production Credit maintains a key provision restricting eligibility to North American-grown feedstocks. This excludes imports such as Chinese used cooking oil (UCO) and South American tallow from receiving U.S. tax benefits.
The update is a win for U.S. soybean and canola producers who have invested heavily in expanding domestic biofuel capacity. Since 2021, the soy crush sector has pumped over $6 billion into rural infrastructure and increased processing capacity by more than 25% to meet biofuel demand.
In another major shift, the bill eliminates the indirect land use change (ILUC) penalty, which growers have long criticized as an outdated and flawed emissions model that unfairly penalizes domestic crops. The ILUC removal aligns emissions scoring with real-world data and levels the playing field for North American producers.
Additionally, the Senate bill increases the Small Agri-Biodiesel Producer Credit to 20 cents per gallon and allows transferability of the 45Z credit — giving smaller producers better access to incentives.
Devin Mogler, president and CEO of NOPA, praised the Senate for making the revisions.
"Maintaining and improving upon the House-passed language ensures that tax policy is aligned with the broader policy goals of supporting our farmers and producers over foreign actors," Mogler said. "The soy crushing sector has made the investments to supply the feedstocks necessary to achieve higher RVOs and continue to strengthen U.S. energy dominance.”
The revised legislation now mirrors the House-passed version, drawing strong support from agriculture stakeholders who see it as essential to protecting rural investment and curbing foreign competition.
