The biodiesel industry makes three socioeconomic contributions to the country. It provides economic stimulus through its investments, operations, purchases, and employment. There are direct environmental benefits by displacing conventional fuel with biodiesel because it is less carbon intensive, therefore reducing greenhouse gas emissions. Lastly, the production of biodiesel provides energy security because the country relies less on foreign oil products. The study from FTI Consulting examined 2017 production data to estimate the following positive contributions to the U.S. economy:
Economic output valued at $21.6 billion across the economy (which translates to U.S. GDP of $6.5 billion)
Employment for approximately 61,900 workers
Paid wages and benefits totaling $3.8 billion
Federal tax contributions of $1.2 billion
State and local tax contribution of $600 million
A reduction in GHG emissions by 14.8 million tons, which is equivalent to taking 3.2 million cars off U.S. roads and
equal to approximately $750 million in social benefits.
The report also looked at the importance of the BTC, a tax credit given to the blenders and shared with the producers that maintains viability of the industry by keeping biodiesel at a stable price. The study found that without the incentive, biodiesel producers would have suffered an average loss of $0.25 per gallon of biodiesel produced in 2017. Currently, it is unknown whether or not the BTC will extend beyond 2017, which could significantly impact the progress of the industry.
The full study can be found here.
Want to learn more about biodiesel?
Check out our page here!