American Biogas Council responds to Bipartisan Budget Act

The trade association for the US biogas industry, the American Biogas Council, has responded to the passing of the Bipartisan Budget Act of 2018.

Passed on 9 February, the legislation only includes a one year retroactive extension of the Production Tax Credit for biogas and biomass through 2017. However, similar credits for other renewable technologies, such as solar and wind, have been extended to 2022.

“While we are grateful to the many members of Congress who continued support the development and deployment of renewable energy sources in general throughout the US, we are extremely disappointed that the Bipartisan Budget Act of 2018 continues to pick winners and losers in renewable energy and put new biogas systems at an economic disadvantage, stifling clean energy growth and investment,” said American Biogas Council executive director Patrick Serfass, in a statement.

On the day before the Bipartisan Budget Act was passed, the American Biogas Council had urged its members to write to Senators and Congress asking for a two year extension to the tax credit for biogas.

"By not extending the credit for biogas into the future, the Act will virtually kill the development of new biogas-electricity projects by giving a 30% advantage to many other renewable electricity projects,” Serfass continued. 

“Biogas systems don't just produce renewable energy, jobs and investment, they also provide a solution for managing waste, nutrient recycling and reducing odours while protecting our air, water and soil in urban and rural America. Unless tomorrow all of urban and rural America decides to go vegan, stop flushing our toilets and start eating spoiled food and things like onion peels and pineapple tops, we will need biogas systems to manage all of this material and turn it into great soil products and renewable energy. It is simply unconscionable that Congress continues to pick winners and losers by incentivising the development other renewable energy technologies and fossil fuels but not biogas systems.

"To put this in context, the renewables industry overall has always had the market tipped against us in favour of fossil fuels which enjoy permanent benefits in our tax code. Then in 2015, Congress's action favoured wind and solar above all other renewables, further tipping the market away from biogas and other technologies. Now, Congress has also incentivised other solar, geothermal, fuel cell, microturbine, combined heat and power, and thermal energy facilities, orphaning biogas, biomass, hydro and waste to energy facilities. It makes no sense. It's poor public policy. And is not in line with an all-of the-above energy strategy.

"If the biogas industry could fairly compete in our tax code with other renewables and fossil fuels, we have the potential to develop 14,000 new biogas projects. These new biogas systems could produce enough energy to power 7.5 million American homes and reduce emissions equivalent to removing up to 15.4 million passenger vehicles from the road. They would also catalyse an estimated $40 billion in capital deployment for construction activity which would result in approximately 335,000 short-term construction jobs and 23,000 permanent jobs to build and run the digesters.”

For Serfass, the way forward for the US government is clear.

“We call on Congress to level the playing field and pass an immediate long-term extension of the Section 45 biomass and biogas incentives, such as those contained in H.R. 4137, the Renewable Electricity Tax Credit Equalization Act, sponsored by Rep. Stefanik (R-NY). This is good for the economy, local jobs, development of infrastructure, and the environment.”