Renewable biofuels, such as corn ethanol, biodiesel and sustainable aviation fuel (SAF), are immediate climate change solutions. Biodiesel and ethanol produced from soybeans and corn grown on farms across Indiana and processed here in-state not only lower greenhouse gas emissions, but they also provide Hoosiers economic relief at the pump and increase demand for corn and soybeans grown by Indiana farmers.
An income tax incentive bill for retailers (HB1315) has been introduced in the 2024 session of the Indiana General Assembly that will boost investment in modern fuel pumps and tanks and create a wider range of fuel options for our state. Should this incentive be adopted, it will add over $223 million in economic activity from biodiesel and grow demand for 51 million more bushels of corn for ethanol production. As we work toward in-state biofuel legislation in the current session, Indiana corn and soybean farmer leaders are also working toward biofuel priorities on the federal level.
Indiana corn farmers believe the use of higher blends of ethanol will improve engine performance and reduce environmental impacts, all at a lower cost to consumers. Also, quickest way to additional corn grind is through expansion of ethanol use. There are several federal priorities that ICGA leaders are actively discussing with legislators on Capitol Hill. These include:
- Expanding market access through the Renewable Fuel Standard (RFS)
- Permanent year-round E15 access
- Offer market-based policy rewards through the Low Carbon/Clean Fuel Standard
- Pass the Next Generation Fuels Act
Biofuels are also a key market for soybean oil. Biodiesel and renewable diesel made from soybeans may reduce greenhouse gas (GHG) emissions by 74%, and Indiana vehicle fleets using B20 have reduced carbon emissions by over 11,000 tons since 2021. Indiana currently produces more than 100 million gallons of biodiesel annually. While Indiana is a leading biodiesel production state, there is an opportunity for growth in selling at the pump. Indiana soybean farmer leaders support several federal policies that will help keep biofuels competitive in U.S. fuel markets:
- Increasing annual volumes for biomass-based diesel and advanced biofuels in the RFS
- Funding for the Biodiesel Fuel Education Program in annual appropriations legislation
- Federal Biodiesel Tax Credit to help grow the biodiesel industry
Additionally, the U.S. Department of the Treasury issued guidance on the Sustainable Aviation Fuel Credit (40B) established by the Inflation Reduction Act (IRA) in mid-December. This progress is positive news for soybean farmers as members have pushed for use of the GREET model to determine eligibility for the SAF Credit. EPA will work with other agencies to develop new GREET methodology over the next couple months that incorporates soybean feedstock.
ICGA and ISA’s Membership and Policy Committee and members are committed to continuing the conversations of farmers’ biofuel priorities, as well as other policy issues affecting Indiana agriculture and rural communities. Membership dollars and the added numbers of farmers across Indiana empowers ISA and ICGA to positively influence policy and regulatory matters impacting the U.S. soybean and corn industry. We are your seat at the table with lawmakers when you need to be working at your operation.
