WASHINGTON, D.C. (Monday, July 19, 2010) - If the advanced biofuel industry is to grow to meet national goals for reducing reliance on imported oil, then enduring federal commitment is vital to maintaining progress in research, development and investment in building infrastructure. The Biotechnology Industry Organization (BIO) today called on Congress to help the industry secure investment by strengthening and extending federal tax incentives for next-generation biofuels in any tax and energy legislation considered this year.
Brent Erickson, executive vice president for BIO’s Industrial and Environmental Section, stated, “The economic downturn in the United States has dealt a blow to advanced biofuels development. Advanced biofuels can reduce reliance on imported petroleum and contribute to renewed economic growth by creating truly green jobs, but only with sustained federal commitment to the goal of rapidly increasing their production in the United States. This support, including new tax credit options for advanced biofuels, loan guarantees and continued support for R&D is vital for producers seeking the private investment needed to build biorefineries and infrastructure. In the current economic environment, biofuel companies are finding it extremely difficult to raise private financing to scale up first-of-a-kind commercial facilities, undercutting the industry’s ability to meet national targets.
“Biofuels are the only way to replace use of petroleum-based liquid transportation fuels today. Any legislation considered this year should provide the consistent, sustained and diverse federal support necessary to enable rapid growth of a sustainable advanced biofuel industry capable of meeting the targets of the Renewable Fuel Standard. Extension and expansion of existing advanced biofuels tax credits will provide potential investors the certainty they need to make long-term investments in new cellulosic and algae-based biofuel facilities.
“A recent report from the Congressional Budget Office distorts the picture of the cost of biofuel tax incentives to taxpayers. Notably, it calculates a penalty against biofuels for reducing use of and consequent collection of excise taxes on fossil fuels. It also fails to count the significant amount of tax breaks provided to fossil fuel producers and importers and it incorrectly calculates the energy content of biofuels, ignoring development of advanced biofuels.
“BIO supports creation of a refundable investment tax credit for cellulosic biofuels that could provide pioneering developers with critical flexibility in electing the form of tax incentive that best suits a given project and mirrors the tax credits available for other alternative energy projects. Similar support for other alternative energy producers has been successful in directing investment to wind, solar and geothermal electricity producers. Parity in federal support can accelerate the development of biorefineries that create high-wage American jobs.”
A recent report commissioned by BIO, U.S. Economic Impact of Advanced Biofuels Production, projects that development of advanced biorefineries could create as many as 29,000 jobs over the next few years and hundreds of thousands by 2030, contributing more than $140 billion in economic growth. For copies of U.S. Economic Impact of Advanced Biofuels Production, please contact Paul Winters at firstname.lastname@example.org or 202-962-9237, or visit http://BIO.org/ind/.
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BIO represents more than 1,200 biotechnology companies, academic institutions, state biotechnology centers and related organizations across the United States and in more than 30 other nations. BIO members are involved in the research and development of innovative healthcare, agricultural, industrial and environmental biotechnology products. BIO also produces the BIO International Convention, the world’s largest gathering of the biotechnology industry, along with industry-leading investor and partnering meetings held around the world. BIO produces BIOtech Now, an online portal and monthly newsletter chronicling “innovations transforming our world.” Subscribe to BIOtech Now.