IRS Guidance for Clean Fuel Tax Credits Relies on Argonne Models

The Internal Revenue Service issued guidance on Section 45Z of the Clean Fuels Production Tax Credit, clarifying how it supports biofuel production. This guidance provides the 2026 emissions rate table and details on using manure-derived fuels and regenerative agricultural practices. The guidance utilizes the GREET model, which was developed by Argonne National Laboratory, to assess life cycle environmental impacts. The Treasury Department plans to issue a final rule later this fall.

The guidance provides biodiesel, renewable diesel, sustainable aviation fuel, and ethanol producers with the necessary tool to calculate the 45Z Clean Fuel Production Credit. This credit calculation relies on models developed by Argonne National Laboratory. Additionally, the U.S. Department of Agriculture’s Feedstock Carbon Intensity Calculator will be used to determine field-level carbon intensity scores for crops.