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OPINION

It’s Time to Level the Playing Field for Biofuels

The opinions expressed by columnists are their own and do not necessarily represent the views of Townhall.com.
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David J. Phillip

America remains the freest and most prosperous nation in the history of the world. Since our founding, we have been a global leader in advancement, innovation, and opportunity. Our free markets breed success and give Americans with innovative ideas a chance to rise to the top. 

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Those innovations are not just technological. They are woven throughout our economy, often in places easily overlooked. Consider the American trucking industry, a pivotal part of our country’s economic strength. In fact, no industry is more important to our supply chain than the trucking industry, which is responsible for delivering a vast majority of the products that wind up in our stores. Whether you are an entrepreneur leading a startup business out of your garage or a CEO overseeing a large corporation, if you sell a product to a distributor, a retail store, or straight to the customer’s doorstep, it’s likely getting there by truck. 

Unfortunately, the tax credits for sustainable aviation fuel (SAF) that were included in the Inflation Reduction Act (IRA) mean the federal government’s meddling presents this vital industry with a potentially dire situation that must be remedied before it is too late. The fuel supply that these trucks depend on to deliver goods from coast to coast, including biodiesel and renewable diesel fuel, is jeopardized by the ill-conceived policies passed by Congress and signed by the president. These poor policy choices are not only going to negatively impact businesses large and small, but they’ll hurt employees of those businesses and consumers, as well. With inflation at a 40-year high, does this seem like a prudent approach to help our workers and consumers?

Due to many domestic and international factors, diesel fuel is already at some of the highest recorded prices in recent history. As the trucking industry looks for alternatives to fuel their vehicles, many fleets have made the switch to biodiesel, which has grown from 100 million gallons processed in 2005 to approximately 3 billion gallons in 2020. New plants are being built and more are coming online each month. This biofuel adoption should be a success story for not only the trucking industry, but also for the businesses and consumers who benefit from an affordable, climate-friendly option that can help reduce shipping costs.

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 Yet, our elected officials have decided to discriminate against biodiesel in favor of sustainable aviation fuel (SAF), putting the continued production of biodiesel and renewable diesel at risk.  

There is a limited supply of the components that go into making biofuels. Giving SAF an enhanced tax credit incentivizes producers of biofuels to ramp up the production of SAF at the expense of other biofuels that have already seen significant adoption throughout the economy. This will not only result in the cost of other biofuels rising, but that cost increase will also be passed down to businesses and consumers on goods we purchase.

Instead of supporting a commonsense policy of treating all biofuels equally, our nation is advancing policies that subtract from the bottom lines of American businesses and entrepreneurs by driving higher transportation and shipping costs throughout the economy. If you are in business today, you have seen all of your costs increase exponentially. Washington further increasing those costs is not helpful. These are not the economic policies that created the free and thriving economy we are used to in America. Quite the contrary, these are policies that increase costs to consumers and stifle the success of those who are on the front lines creating jobs and serving as the heartbeat of our economy.  

The simple solution is for Congress to rectify this self-imposed imbalance by bringing parity to the biofuel production market. Such a move to implement a commonsense, market-based policy will inspire the confidence of consumers and businesses. Further, it will demonstrate to the trucking fleet supporting the delivery of so much of what we need on a daily basis that their work is here to stay.

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 American businesses and consumers deserve free and fair policies that enable both job creators and hardworking Americans who shape the future of our economy a fair chance to continue to realize their dreams. American innovators have done so much to ensure our economy has kept going and growing, even in the toughest times. Let’s give all Americans the support they need to continue doing what they do best.

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