Dear Chairman Camp, Chairman Baucus, Ranking Member Levin, and Ranking Member Hatch,
We are writing to encourage Congress to extend two critical tax incentives – the Cellulosic Biofuels Producer Tax Credit (PTC) and the Accelerated Depreciation Allowance for Cellulosic Biofuel Plant Property – that are vital to the ongoing development of the domestic advanced biofuels industry. To ensure stability in the marketplace, Congress should extend these provisions, currently set to expire at year‐end, for a minimum of five years.
The advanced biofuels industry is at a critical stage of development. Since the passage of the Energy Independence and Security Act of 2007 (EISA), which amended the federal Renewable Fuel Standard (RFS) to require 16 billion gallons of cellulosic biofuel use by 2022, the advanced biofuels industry has made great strides in reducing the cost of production and developing first‐ of‐kind technologies and bio‐refining operations to meet the RFS. In a difficult financial market, we are breaking ground on first commercial plants in several states across the country, and continue to work on dozens of additional projects in the final stages of development. As was the case with the conventional biofuels industry, these processes can be replicated rather quickly once the technology is proven at commercial scale.
As leaders in a critical innovation sector in the United States, we are well‐aware of the financial constraints facing this country, including but not limited to the federal budget. However, the United States also faces the challenge of reducing its costly dependence on foreign oil and competing in a $2.4 trillion worldwide clean energy market with a number of countries already implementing aggressive alternative energy development programs. Accelerated depreciation allowances and production‐related tax credits are currently offered to incumbent fossil energy industries. As such, the cellulosic biofuel PTC and accelerated depreciation allowance are critical to our efforts to attract capital given that these types of incentives are offered to other U.S. energy sectors. It will be much more difficult for our companies to develop projects in the United States if current depreciation allowances expire and taxes on our industry increase in 2013.
As we prepare for deployment of our technologies in 2013 and beyond, we are also aware of ongoing discussions about more comprehensive tax reform. As a general matter, we support efforts underway to update, level‐set and innovate the U.S. tax code, particularly as it applies to innovation sectors such as the cellulosic biofuels industry. We look forward to the opportunity to
discuss different strategies to attract new industries to the United States in financially responsible ways. However, it is absolutely critical to avoid even temporary expiration of current incentives, as the mere threat of inconsistent and uncertain energy policy increases investment risk and ultimately drives private capital to other countries and industries.
Given the time horizon of many of our projects, we encourage Congress to move quickly to maintain and extend the cellulosic biofuel PTC and accelerated depreciation allowance. We look forward to working with you on this important matter.
Javier Salgado President & CEO Abengoa Bioenergy
Eric McAfee Chairman & CEO Aemetis, Inc.
R. Michael Raab President Agrivida, Inc.
Chief Executive Officer Beta Renewables
Arnold R. Klann CEO/President
BlueFire Renewables, Inc
Kevin R. Weiss P.E. CEO
Byogy Renewable, Inc.
Richard Hamilton President & CEO Ceres
Alan Shaw, PhD President & CEO Codexis, Inc.
William J. Roe President & CEO Coskata
Hugh Welsh President DSM NA
Vincent Chornet President & CEO Enerkem
Craig Stuart‐Paul CEO
William A. Lee
Chief Executive Officer Frontline BioEnergy
E. James Macias President & CEO Fulcrum BioEnergy, Inc.
Todd Harvey President and CEO GeoSynfuels
Pat Gruber CEO
Mr. Christian Morgen
General Manager, International Sales & Marketing Inbicon A/S
Peter Williams CEO
Brian Foody President & CEO Iogen Corporation
Fred Cannon President and CEO Kior
Dr. Jennifer Holmgren Chief Executive Officer LanzaTech
Ross MacLachlan President and CEO Lignol Innovations Inc.
Bill Brady President & CEO Mascoma
Neal Gutterson, Ph.D. Chairman, President & CEO Mendel Biotechnology, Inc.
Novozymes North America
Jeff Broin CEO POET, LLC
Christopher Dale CEO
D. Hunt Ramsbottom
Chief Executive Officer, President & Director Rentech Inc.
Wayne Simmons President & CEO Sundrop Fuels
Arunas Chesonis CEO Sweetwater
Gary W. Luce CEO Terrabon, Inc.
TMO Renewables Ltd.
Founder and CEO
WESTAR TRADE RESOURCES
Jim Imbler President & CEO ZeaChem