This content is sponsored by Clean Fuels Alliance America.
The United States is the world’s largest producer of biofuels, and supporters of clean fuels in Congress want them to continue to play a key role in the country’s energy growth.
Production of biodiesel and renewable diesel has doubled in recent years. But to continue that trend, producers will need to keep making investments in new capacity, processing, as well as collection of feedstocks. Congress and the Trump administration could have a major role in maintaining that momentum.
A big change took place at the federal level 20 years ago, when Congress created a biodiesel tax credit and the Renewable Fuel Standard. RFS mandates the blending of renewable fuels into gasoline and diesel.
When those policies took effect, biomass diesel production was close to 100 million gallons.
“Today we’re over 5 billion gallons,” said Kurt Kovarik, vice president of federal affairs for Clean Fuels Alliance America. “And much of that growth has really been in the last two to three years, as the policies have signaled support for the industry and the demand for the fuel has increased.”
But Kovarik, who spoke with WTOP for its Energy Innovation Strategy Session 2025, said several things need to take place in Washington to sustain that positive trend.
Will EPA ‘hit the accelerator’ on RFS?
There is bipartisan support in Congress for the Environmental Protection Agency to act on RFS and raise the renewable volume obligation (RVO) for biomass-based diesel and advanced biofuels.
Kovarik pointed out that the RVO level of the previous three years was “significantly below” what the industry has been producing. “Our message to this administration is, utilize the RFS to hit the accelerator for domestic energy production,” he said.
The trade association recommends that EPA propose and finalize the 2026 biomass-based diesel volume at 5.25 billion gallons. “The future of biofuels is very, very strong, and the market is much bigger than most people comprehend,” said Rep. Dusty Johnson (R-SD), member and former chair of the House Biofuels Caucus.
Johnson, who is part of a group of lawmakers who set out their concerns to new EPA Administrator Lee Zeldin earlier this year, said he believes Zeldin understands where lawmakers are coming from when they press for RFS to be acted upon.
“He’s a straight shooter who understands the power of American energy,” Johnson said. “And by the way, his boss is talking about American energy dominance, and biofuels are a critically important part of building that dominance.”
Rep. Mariannette Miller-Meeks (R-IA), who chairs the Conservative Climate Caucus, hopes that benchmarks for biofuels as well as eased restrictions on the use of E-15, the ethanol blend of gasoline, will be implemented.
“I can tell you farmers and agriculture here in Iowa, if you can increase the RVOs and get year-round E-15, those things will dramatically help farmers,” she said. “This is something that we know we have the capacity to do. It is homegrown American energy right out of our fields.”
Push for 45Z, the clean fuel tax credit
Advocates of biofuels are also trying to get the Clean Fuel Production Credit, known as 45Z, improved during federal budget reconciliation. It was part of the Inflation Reduction Act passed under President Joe Biden and is designed to encourage low-carbon fuel production.
“Our goal is to both extend that tax credit and also to make it work better for the farmer,” Kovarik said, noting language in the provision could be tweaked. “First off, our hope is to safeguard and maintain what we have and then improve it and extend it if we can.” He added that this approach has bipartisan support.
Lawmakers are also trying to advance various pieces of legislation to utilize renewable fuels more fully. One of them is a bill reintroduced by Miller-Meeks and Rep. John Garamendi (D-CA).
The Renewable Fuel for Ocean-Going Vessels Act would let companies preserve Renewable Identification Numbers (RINs) as credits under RFS for marine fuel. It would reduce emissions from cargo vessels and cruise ships by providing another incentive for producing renewable biofuel.
“What we’re doing here is to use the legislation to encourage the shipping industry to use biofuels that are generated — it could be hydrogen, it could be methane, it could be other sources — back to the biodiesel that can be created in the refineries to fuel ships,” Garamendi said.
What is the outlook for energy innovation?
Regardless of their political party, the lawmakers agree that U.S. energy policy is not an either-or proposition when it comes to fossil fuels versus renewable fuels.
Johnson noted that although breakthroughs can’t be guaranteed, there are a lot of smart people working on a wide range of ideas. “Not every idea is going to be a winner,” he said. “And that’s why it’s important to have a number of different irons in the fire in the biofuel space, so that we can make sure that we hit on one or two or three and ride that hockey stick of success.”
Miller-Meeks is also optimistic. “With the right policies and the reduction of some of the regulatory barriers, I think that the outlook is very good,” she said.
Kovarik believes growth is only going to continue. “Our product has never been in demand more than it is now, whether that’s in rail, heavy-duty trucking, aviation, marine or home heat. We’ve got great opportunities to decarbonize, to add value to a U.S. energy product and displace petroleum at the same time,” he said.
“In my mind, that’s what domestic energy dominance means.”
Learn more about fuel innovation possibilities discussed by all three representatives as well as Kurt Kovarik of the Clean Fuels America Alliance during individual sessions for WTOP’s Energy Innovations Strategy Session 2025.
