The energy title is bound to get a lot of debate during Farm Bill discussions. It comes as the Administration released its long-awaited update to the GREET model. The formula is used for assessing lifecycle emissions. It also released details about how farmers can get tax credits for producing low-carbon jet fuel.
The credits are divided into two parts. To qualify for the 40B credits, worth up to $1.25 per gallon, corn producers must use tilling, cover crops, and precise fertilizer applications. Soybean growers must use tilling and cover crops. However, this tax credit expires at year’s end, and growers have already started work on this year’s crops.
The 45Z tax credit becomes effective on January 1st, providing up to $1.75 per gallon. Corn and soybean farmers must cultivate their grains using one of those methods to qualify for the credits.
Ag Secretary Vilsack says the new guidelines send a clear signal that farmers will be a part of the sustainable jet fuel market for decades to come. Proponents say the new model will not impact a farmer’s bottom line because they sell their corn and beans elsewhere. However, Senator Chuck Grassley is pushing back, calling that “hogwash.” He says people making the decisions do not know much about how farmers deliver their grains.
“Widespread use of sustainable aviation fuel will help fight global warming, but rejecting grain feedstocks will impede efforts to produce that fuel on a commercial scale. Another question is, who will bear the Administrative burdens associated with the new requirement? Will it be the farmer? Will it be the ethanol refineries? Will it be sustainable aviation fuel plants?”
Industry groups are also responding to this development.
