Manure Manager

News Biogas United States
Renewed tax credits to drive biogas industry boom


January 21, 2020
By Manure Manager

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2020 sees the renewal of tax credits that had been expired since Dec. 31, 2017. The American Biogas Council (ABC), a trade organization that represents the biogas industry in the U.S., believes these credits will drive industry growth and project development. The credits can be used for projects that will be developed this year or started operation during the last two years, when the renewable energy or alternative fuel credits were expired.

The tax extenders package signed into law on Dec. 20, 2019 includes provisions for the Section 45 Production Tax Credit for renewable electricity and the alternative fuel excise tax credit for biogas projects that provide vehicle fuel. With the passage of this legislation, biogas now has parity with several other renewable energy technologies which had previously obtained longer term tax credits in 2015 and 2018 respectively.

“Our members will tell you it’s been a tough several years trying to finance many biogas projects while we compete with unfair advantages given to the fossil fuel industry, as well as our sister renewable industries,” said Patrick Serfass, Executive Director of the American Biogas Council (ABC).

“For now, the biogas industry is on much more level footing.  Our members are already developing the next biogas projects that will recycle organic material into renewable energy and soil products while creating new jobs and investment.”

The ABC believes the passage of this bill is an indication of Congress’ readiness to address remaining disparities in the tax code between fossil fuels – which have their tax credits permanently baked into the tax code – and renewable technologies and views this as a first step to more comprehensive renewable energy tax policy.