The Overlooked Step to Max Out Your 45Z Credit

by Danielle Anderson (Christianson/Ethanol Producer Magazine) Renewable fuel producers are eager to claim the 45Z Clean Fuel Production Credit, but one powerful opportunity often flies under the radar—offsetting a facility’s electricity emissions through Energy Attribute Certificates (EACs).

As one of the most significant incentives for low-carbon fuel production in recent years, 45Z rewards producers that can demonstrate measurable reductions in their carbon intensity (CI). The difference of just a few CI points can translate into millions of dollars in additional credit value over the life of the program. This makes every emissions-reduction strategy worth exploring, especially those—like EACs—that can be implemented without major infrastructure changes.

EAC eligibility criteria for 45Z are outlined in the Department of Energy’s 45ZCF-GREET User Manual. While tailored for ethanol and other clean fuel producers, these rules draw heavily from the 45V Hydrogen Production Tax Credit framework.

What are Energy Attribute Certificates?
An EAC is a contractual instrument that conveys information—or “attributes”—about one megawatt-hour of electricity, including the resource used to create it and the emissions associated with its generation. Owning and retiring an EAC gives the holder the right to claim the renewable attributes it represents.

Three Key Requirements for EAC Eligibility
The DOE identifies three key guardrails—deliverability, temporal matching and incrementality—to ensure that a transportation fuel producer’s electricity use accurately reflects the emissions from the specific generators associated with the purchased and retired EACs.

Two Options for Claiming Electricity Use
The first option available to ethanol producers is behind-the-meter (BTM) electricity, which is electricity generated and consumed on-site that can be claimed using qualifying EACs.

Important Limitations
• No gas EACs – Book-and-claim instruments for renewable natural gas (RNG) are not currently allowed under 45Z.

• No double counting – The same EAC cannot be claimed under multiple programs. For example, an EAC used for 45Z cannot also be claimed under California’s LCFS.

EAC Registries and Verification
Only qualified EAC registries may be used to issue and retire EACs.

Why It Matters for Your CI —and Your Bottom Line
Electricity emissions can represent a significant share of your plant’s CI.