Nebraska Governor Signs Bill Promoting Use of Biodiesel

(Clean Fuels Alliance America) Legislation adds Nebraska to the growing list of Midwest states prioritizing home-grown fuels and adding value to their state's agriculture industry -- Gov. Jim Pillen (R-NE) signed into law legislation promoting the sale and use of biodiesel in Nebraska. The bill, LB 727, provides retail tax incentives for the sale of biodiesel at fuel retailer locations throughout the state adding value to Nebraska soybean farmers while promoting continued growth of the burgeoning renewable fuel industry.

Part of an omnibus revenue bill, the Nebraska Biodiesel Tax Credit Act, provides a 14-cent per gallon credit for the sale of biodiesel. The credit is applied to a Nebraska fuel retailer’s income tax liability. Total funding for the program is $5 million.

“We applaud Gov. Pillen for signing legislation that will continue to strengthen the momentum of a growing biodiesel market,” said Donnell Rehagen, CEO for Clean Fuels Alliance America. “Nebraska has responded to the call to decarbonize through this forward-thinking legislation that promotes the production and use of biodiesel, a homegrown fuel from homegrown feedstocks.”

The proposal was introduced by Sen. Tom Brandt of Plymouth and amended to LB 727 which was shepherded through Nebraska’s unicameral legislature by Sen. Lou Ann Linehan of Elkhorn. The biodiesel proposal received overwhelming support from Nebraska’s agriculture industry, biodiesel producers and fuel marketers. The legislation ultimately passed unanimously by the Nebraska Senate.

“This legislation recognizes the impact biodiesel has on the demand for soybean oil,” said Courtney Lawrenson, Clean Fuels Alliance America Governing Board Member and AGP Vice President of Oils and Energy. “AGP has long recognized the steady growth of the soybean processing industry with plans to expand feedstock production capacity in David City and applauds lawmakers for solidifying Nebraska’s leadership role in the industry.”

Nebraska is a leader in soybean production – among the top six soybean producing states. In 2022, the biodiesel industry in Nebraska supported an estimated $322 million worth of overall value to Nebraska soybeans. For a Nebraska farmer with 500 acres, the biodiesel and renewable diesel industry supports about $28,400 to their bottom line.

“Passing the Biodiesel Tax Credit Act is a win for Nebraska producers and consumers,” said Lori Luebbe, Executive Director for the Nebraska Soybean Association. “It reinforces the commitment to making renewable fuels an integral part of our state’s energy portfolio. We appreciate the support of Gov. Jim Pillen, Sen. Tom Brandt, and members of the legislature for ensuring biodiesel is a part of Nebraska’s clean energy solution.”

Overall, the Nebraska biodiesel industry supports $833 million in economic activity and close to 5,900 jobs, many of which are in rural parts of the state.

“We were thrilled to work with our member associations including the Nebraska Soybean Association, AGP and the other organizations who helped build a strong coalition advocating for this legislation while making biodiesel a priority in Nebraska,” said Jeff Earl, Director of State Regulatory Affairs for Clean Fuels.

Nebraska joins the ranks of Illinois, Iowa and Missouri as states that have recently passed legislation supporting the sale and production of biodiesel. These efforts will help grow the biodiesel market in the Midwest by over 300 million gallons.