If you’re feeling fatigued by the constant swirl of 45Z updates (or lack-there-of) and the ongoing uncertainty surrounding delivery of credit guidance by the US Treasury, you’re not alone. The past two years since the IRA was passed have been marked by speculation, incomplete analysis, and delayed timelines. However, there is finally optimism that this cycle of severe uncertainty is close to breaking.
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With preliminary guidance expected in the next 20 days, now is the time to focus on effectively navigating the initial set of rules that (hopefully) are delivered before the end of the Biden Administration. As the calendar turns to January 1, we’re striving to help stakeholders in a fuel and/or feedstock supply chain clarify where they stand today and what our team will be watching for when the guidance finally lands.
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Where We Are Today:
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After months (or years) of anticipation, the US Treasury has stated its intention to release preliminary guidance for the 45Z Clean Fuel Production Credit. The USDA has issued its recommendations for technical guidelines to the White House and the US House Ways and Means Committee has completed its RFI for effective implementation of 45Z.
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Should the US Treasury meet its anticipated goal of January guidance delivery, these Rules, while preliminary and pending implementation by the incoming administration, will likely outline critical aspects of the program. This should include how carbon intensity (CI) will be calculated, the extent to which feedstocks qualify, and the tangible metrics required to calculate what ROI will be available for qualifying fuel producers. And for the biofuel industry, it promises to provide the first real glimpse into how to access the 45Z credit.
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However, the release of this guidance is just the beginning. As the current administration hands the reins over to the incoming Trump administration, that new administration will have several options: implement the guidance as-is, introduce revisions to align with new priorities, or scrap the framework entirely and start over. Unfortunately, each scenario brings its own level of uncertainty, and the industry’s timeline for clarity could stretch into mid-2025—or beyond.
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Despite the continued uncertainty, one thing is clear: guidance, even in a preliminary state delivered by an outbound administration, stands to provide the first real progress made towards practically accessing the 45Z credit in 2025.
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The decisions made in the coming days will determine not only the credit’s feasibility but also how effectively it can scale across the biofuel production landscape. That scale and feasibility will all come down to the details delivered, so what details can you be watching for when (if) guidance comes across your desk…
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What We’re Watching For:
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When guidance is released, here are the key areas we’ll be watching closely that stand to dramatically impact CI outcomes across the industry:

• Land Use Change Penalties:
  It's well known that penalties tied to land use changes (LUC) play a significant role in CI scoring. And LUC decisions are often far more subjective than resolute. The “science” on land use change differs greatly from expert to expert and the metric selected by the treasury and applied to primary biofuel feedstocks like corn and soybeans may be one of the most impactful elements of guidance delivery
• On-Farm Data for Feedstock Differentiation:
  GREET-based CI scoring is expected to reward practices like reduced tillage, precision fertilizer application, and adoption of climate smart ag management. What exact management practices will be recognized, what documentation will be required to substantiate claims, and what will independent verification look like.
• Book-and-Claim vs Mass Balance Systems:
  These accounting approaches determine whether or not environmental attributes can be separated from physical deliveries, offering potential flexibility but bringing with it significant possible risks.

• Inclusion of Advanced Technologies:
  Innovations like Carbon Capture and Storage (CCS), renewable natural gas (RNG), and renewable electricity are expected to qualify for credit multipliers, but will there be a timeline for adoption or a grace period for early adopters? Where will CCUS fit? And what flexibility will there be for future innovation of the term of the credit?

• CI Calculation Timelines:
  Producers need to know whether qualifying fuel CI scores will be calculated over a 12-month, 24-month, or real-time basis. This decision will directly impact how fuel producers manage their operations. Investments made today in low-carbon technologies or efficiency upgrades reducing CI must be recognized as soon as possible in CI scores to ensure they deliver maximum return.
• Transition from BD Tax Credits to 45Z:
  The existing biodiesel tax credit, which has been a cornerstone of the industry, is set to phase out after 2024 as 45Z takes effect. This transition means biodiesel and renewable diesel producers accessing the historic credit will need to shift from a fixed per-gallon credit to a variable credit structure based on CI scores. Will GREET-based CI scoring play a central role in determining credit eligibility as expected? For BD/RD producers, how will the diverse range feedstock used (e.g., soybean oil, canola oil, used cooking oil) and the farming practices associated with these feedstocks impact scores?

Final Thoughts:
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The next few weeks should provide an early glimpse into the true opportunities that 45Z will present for the biofuel supply chain. While guidance will likely raise additional questions even as it seeks to provide answers, it stands to provide industry stakeholders with the matrix we need to make actionable, informed decisions in the year ahead.
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For those of us in biofuel and feedstock production, the next 20–30 days will set much of the tone for 2025. At incite.ag, we’ll be here to guide you through these pivotal moments, offering clarity and innovative tools as the landscape evolves. The wait for guidance has been long, but its arrival signals a new chapter—one we’re ready to navigate with you. Stay informed, stay ready, and let’s Turn your Emissions into Income.

incite.ag Staff‍
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incite.ag guides producers across the agricultural supply chain to Turn Emissions into Income. Incite.ag’s CI scoring system unlocks novel revenue streams and empowers producers to take control of their unique CI Scores. Learn more by hitting the link below or reach out to the team directly at success@incite.ag or 815.373.0177.