By Andi Anderson
The Illinois Farm Bureau's team is closely monitoring the potential for tax credits that could benefit conservation-minded farmers as federal guidelines draw near. The IRS and U.S. Department of Energy are tasked with determining whether farmers should be rewarded for their contributions to renewable energy, particularly ethanol derived from crops like soy and corn.
Michael Wang of Argonne National Laboratory presented a carbon intensity scoring model at a recent meeting in Bloomington, outlining how farmers' environmental practices could be measured for their success in contributing to renewable energy. While details on tax credits are yet to be finalized, David Isermann, a member of the IFB environmental team, expressed confidence that the model will play a significant role, with a decision expected from the federal government in the coming months.
The anticipated tax credits for biofuel manufacturers are set to begin in 2025 and continue through 2027. The model assesses conservation practices throughout the biofuel life cycle, and farmers hope to be compensated for their efforts, aligning with the contributions of biofuel manufacturers. The tax credits aim to offset revenue losses due to decreased fuel demand, providing a potential boost for farmers.
The push towards sustainable aviation fuel is a driving force behind this initiative, as farmers employing conservation measures contribute to carbon-neutral goals, particularly in the production of ethanol. The Inflation Reduction Act of 2022 set this initiative in motion, promoting alternative energy among its goals. As farmers play a crucial role in achieving carbon-neutral objectives, the potential tax credits recognize and incentivize their contributions to renewable energy and environmental conservation.
Photo Credit: Illinois Farm Bureau
Categories: Illinois, Business