The 45Z clean fuel production tax credit is being used for unjustified giveaways to the conventional biofuels industry. The Senate should stop it.

The Clean Air Task Force contends that the Senate's version of the 45Z clean fuel production tax credit acts as a giveaway to mature biofuel industries while hindering the development of sustainable aviation fuels (SAF) and clean hydrogen. The authors argue that refocusing 45Z on advanced aviation fuels would reduce government spending and allow for the restoration of the 45V clean hydrogen production tax credit, which is essential for U.S. competitiveness against China in the global clean fuels market.

• The Senate's version of the 45Z tax credit is projected to be significantly more expensive than current policy, with the Joint Committee on Taxation estimating an additional $57.1 billion cost through 2034, bringing total spending to $65.5 billion.
• The 45Z credit as drafted primarily benefits producers of conventional on-road fuels, such as ethanol, biodiesel, and renewable diesel, rather than incentivizing innovative clean fuels.
• The Senate's revisions to 45Z undermine the production of sustainable aviation fuel (SAF) by repealing a special higher tax credit rate for SAF and removing requirements for producers to account for indirect land use changes.
• The reduction of the 45V clean hydrogen production tax credit in reconciliation bills threatens the domestic hydrogen industry and projects in Texas, such as the HyVelocity hydrogen hub and Baytown, which could employ 45,000 and 300 people respectively.
• The U.S. risks losing global competitiveness to China in the production of clean methanol, ammonia, and SAF if federal policy continues to reward conventional fuels over clean hydrogen and advanced fuels.

APA

Starr, R., & Lewis, J. (2025). The 45Z clean fuel production tax credit is being used for unjustified giveaways to the conventional biofuels industry. The Senate should stop it. Clean Air Task Force. https://www.catf.us/2025/06/45z-clean-fuel-production-tax-credit/

Chicago

Starr, Rachel, and Jonathan Lewis. The 45Z clean fuel production tax credit is being used for unjustified giveaways to the conventional biofuels industry. The Senate should stop it. Clean Air Task Force, 2025. https://www.catf.us/2025/06/45z-clean-fuel-production-tax-credit/.

Wikipedia

{{cite report |last1=Starr |first1=Rachel |last2=Lewis |first2=Jonathan |title=The 45Z clean fuel production tax credit is being used for unjustified giveaways to the conventional biofuels industry. The Senate should stop it. |publisher=Clean Air Task Force |date=11 June 2025 |url=https://www.catf.us/2025/06/45z-clean-fuel-production-tax-credit/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{starr202545z, author = {Starr, Rachel and Lewis, Jonathan}, title = {{The 45Z clean fuel production tax credit is being used for unjustified giveaways to the conventional biofuels industry. The Senate should stop it.}}, institution = {Clean Air Task Force}, year = {2025}, month = jun, url = {https://www.catf.us/2025/06/45z-clean-fuel-production-tax-credit/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }