Platts proposes to modify Chicago, Houston biodiesel B100 tax credit calculation Feb 24

Platts, part of S&P Global Commodity Insights, proposes to modify the federal tax credit for its biodiesel (B100) price assessment in Houston and Chicago, effective Feb. 24, 2025.

This change aligns with the transition under the Inflation Reduction Act. where effective Jan. 1, 2025, the blender's tax credit was to be replaced by the Clean Fuel Production credit. Platts will monitor further guidance on the transition of the IRA tax credit.

The new federal tax credit provides a maximum of $1 per gallon for non-SAF fuels for producers meeting prevailing wage and registered apprenticeship requirements, requiring a maximum limit carbon intensity of 50 kgCO2/MMBTU. The credit amount will be proportional to the level of emissions reduction achieved, up to the max $1 full credit.

Platts proposes to use California Air Resources Board's (CARB) Biodiesel Carbon Intensity of 28.51 gCO2e/MJ, from Substitute Pathways for Reporting Fuels with Unknown CI for 2024.

Platts proposes to calculate lifecycle greenhouse gas emissions reduction percentage as a fraction, the numerator of which is the maximum carbon intensity (50 kgCO2/MMBTU) minus the biodiesel CI of 28.51 gCO2e/MJ (or 30.08 kgCO2/MMBTU) and the denominator of which is the maximum carbon intensity. The credit will be rounded to the nearest hundredth cent.

(50-30.08)/50 x 100 cents/gal = 39.80 cents/gal

Therefore, the total biodiesel tax credit Platts proposes to use in B100, is 39.80 cents/gal.

Please submit any feedback, comments or questions about this proposal to mrts_biofuelsandfeedstocks@spglobal.com and pricegroup@spglobal.com by Feb. 14, 2025.

For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing.

Platts will consider all comments received and will make comments not marked as confidential available upon request.