The US biodiesel industry has set a record for annual production, according to the latest US Environmental Protection Agency figures, proving the power that strong domestic energy policy has in creating jobs and boosting the economy.
The industry has produced more than 802 million gallons of biodiesel in plants from Florida to Iowa to Washington state, the figures show, more than doubling 2010’s production of about 315 million gallons and breaking the previous record of about 690 million gallons set in 2009. The new record comes as a federal tax incentive for biodiesel was reinstated in 2011, and as the incentive is in danger of expiring December 31, 2011, without congressional action.
“I can say without question that this tax credit has helped us grow our production and hire new people, and it will play a big role in our growth going forward,” said Gabe Neeriemer, president of Patriot Biodiesel in Greensboro NC. “It will affect how many people we can hire, how much feedstock and equipment we buy, and how many truckers we put to work delivering fuel.”
Patriot Biodiesel was forced to temporarily suspend operations when the tax credit expired in 2010. With the incentive restored in 2011, the plant is not only back online but also is expanding production to about 5 million gallons per year and hiring a half-dozen new employees.
“This incentive is working, and particularly in this kind of economy when politicians say they’re doing everything they can to create jobs, I can’t imagine why Congress would allow it to expire,” said Neeriemer.
The biodiesel industry’s rebound comes after Congress reinstated the fuel’s $1-per-gallon tax credit in December 2010. Without the incentive in 2010, production dropped dramatically as dozens of plants shuttered and thousands of people lost jobs.
Increased production in 2011 will support more than 31,000 jobs—up from fewer than 13,000 in 2010—while generating at least $3 billion in GDP and $628 million in federal, state, and local tax revenues, according to a recent economic study conducted by Cardno-Entrix. In addition to creating jobs and economic activity, biodiesel is reducing US reliance on foreign oil, bolstering economic and national security by diversifying the fuel supply, and reducing tailpipe pollution and greenhouse gases emissions.
“This tax incentive is without a doubt stimulating production of biodiesel and creating jobs. We’re clearly seeing that from our members across the country,” said Anne Steckel, vice-president of federal affairs at the National Biodiesel Board, the trade association representing US biodiesel. “We have a little over a month before it could expire again, and it is past time that Congress step up and pass an extension to keep this industry’s momentum going.”