Themes from the US Treasury April 10 Comment Submissions
When the US Treasury and IRS released their much anticipated initial guidance for the 45Z Clean Fuel Production Credit back in January, it kicked off a wave of questions, clarifications, and strategic maneuvering across the fuel production supply chain. A key cornerstone of that activity was the opportunity to submit comments and feedback to the Treasury on their preliminary guidance with the objective of steering final guidance towards a more feasible, implementable, and ultimately successful credit program.
On April 10, over 150 of biofuel producers, technology firms, consultants, SAF developers, and feedstock suppliers submitted formal comments—providing one of the clearest windows yet into what different corners of the industry are advocating for and the direction Treasury could be likely to take if the prioritized themes advocated for by the industry are adopted in final guidelines.
We have completed our review of public submissions and distilled a set of key themes. These aren’t just technical issues. They reveal how companies across the industry are positioning themselves and their network for 45Z, where the consensus lies, and what types of objectives are likely to gain traction in final rule-making versus those that may never get off the ground.
Join us as we unpack some of the top themes in the April 10 comment portfolio—and highlight how these signals help stakeholders calibrate their own 45Z strategies.
#1
Prevailing Wage and Apprenticeship (PWA) Still Doesn’t Fit the Sector
If there’s one area where there’s near-unanimous agreement, it’s on the misalignment between prevailing wage and apprenticeship (PWA) requirements and rural fuel production. Nearly every producer-submission flagged the operational difficulty of securing PW labor or meeting apprenticeship quotas in regions where neither infrastructure exists and/or costs are operationally prohibitive.
Most asked for common-sense adjustments: safe harbor provisions, repair/maintenance carve-outs, and error correction pathways that don’t derail credit eligibility. There is a tempered compromise being sought, not asking to eliminate labor standards—but with clear momentum around creating a version of compliance that matches the on-the-ground labor realities in this industry.
#2
Strong Demand for Provisional Emissions Rates (PERs)
As expected there's a strong appetite for applications to access provisional emissions rates or PERs—especially for producers who are investing in CI-reducing technologies or practices not yet captured in the emissions tables.
Right now, PERs are theoretically allowed, but the actual process is undefined. That’s holding back planning, project investment, and in some cases, participation.
What the industry is asking for here is straightforward: define the PER process, set a “shot clock” for review timelines, and clarify how empirical data, co-products, and USDA FD-CIC-aligned inputs can be submitted. Many are already building toward this. They just need the rules in place.
#3
Fiber-Based Ethanol Needs a Clear Lane
Despite being widely recognized as a low-CI pathway under LCFS and other frameworks, fiber ethanol (e.g., corn kernel fiber, sorghum fiber) was not clearly addressed in the current 45Z emissions tables.
Multiple commenters flagged this as a gap—and a potentially disqualifying one. Their position is clear: fiber-based fuels reduce CI, and producers using these pathways shouldn’t be lumped in with starch-based ethanol or forced into the PER process just to qualify.
This is less of a technical debate than a recognition issue. And it's one that could unlock credits and significant CI reductions for advanced production technologies that are already commercialized.
#4
Qualifying Sales Language Must be Clarified
Several tax and compliance professionals zeroed in on what might be the biggest areas of uncertainty in the preliminary guidelines: the limitation on which fuel sales qualify for the credit.
The current language implying that only sales to end users (or those who directly blend and consume the fuel) may qualify. That would disqualify a vast share of ethanol volumes moved through marketers, traders, and distributors—who are the backbone of biofuel commerce.
There’s a strong call to fix this. The recommendation: Treasury should recognize chain-of-title or mass balance systems that track product eligibility without requiring direct end-user sales. This isn’t a niche concern—getting this wrong could undermine the integrity of the credit altogether. But there continues to be socialized confidence in this gap being filled with common-sense language and detailed definitions.
#5
Feedstock Book-and-Claim is Desired by Many—But Far from Certain
Unlike mass balance tracking for feedstocks, the current system being proposed, the potential use of book-and-claim systems continues to draw mixed reactions, depending on a stakeholder’s competitive interests.
Some see it as a way to extend the benefits of low-CI farming practices beyond the constraints of physical grain flow. Others are wary of the implementation complexity, the risk of market manipulation, or the lack of federal infrastructure to monitor it.
Leaders within the administration have acknowledged the concept and opportunity of a Book and Claim system for feedstocks but in the same breath have openly questioned whether current federal entities have the authority and/or resources to support such a system. That’s a signal: even as book-and-claim builds its roster of supporters, it seems unlikely to be a centerpiece of early implementation.
#6
Rounding Thresholds Create a Cliff
Multiple comments pointed to the binary nature of the emissions factor (EF) rounding convention in the statute—specifically, the fact that fuels with CI scores just over 47.5 kg CO₂e/MMBtu are shut out of the credit entirely.
Several stakeholders suggested moving toward a linear sliding scale—crediting every 0.1 kgCO₂e/MMBTU reduction, rather than creating hard cutoff tranches. It’s a simple idea that makes a lot of sense in practice. Whether the Treasury will adopt it depends on whether there’s statutory wiggle room, but the practical rationale is strong.
#7
Third-Party Verification Needs Guardrails
Verification will be the linchpin of 45Z compliance. But the guidance so far is light on the details of who qualifies, what safe harbors exist, and how verified scores are protected.
Several firms asked for verification roles to be limited to organizations (not individuals), aligned with CARB’s accreditation framework. They also asked for liability protection when producers act in good faith based on verified CI data.
Expect this to evolve in tandem with the rollout of any USDA climate smart ag feedstock verification protocols. But there’s agreement that the current rules are too vague for something this critical.
#8
Short Credit Window Creates Long-Term Uncertainty
Many comments pushed for a longer credit window beyond 2027. The most common tasks ranged from 7 to 13 years—aligned with capital cycles, planning decisions, and other similar section 45 credits.
While the Treasury can’t unilaterally extend the law, commenters clearly want regulators to publicly support Congressional action to make 45Z more durable. Until then, most are planning for the current window—but hoping for an extension.
Without this clarity, producers with novel processes or regional efficiencies will remain sidelined while awaiting full GREET integration—delaying their participation and distorting market access.
Reading Between the Lines
These comment letters don’t just reflect what people want—they also reveal how different players are positioning themselves. You can see who’s betting on fiber ethanol, who’s quietly pushing to use imported RNG or RECs, and who’s laying the groundwork for practice-based feedstock scoring at scale.
Just as importantly, you can spot the difference between realistic policy asks and long-shot wish lists. Most commenters aren’t asking for 45Z to cover every new idea, technology, or on-farm management practice. They’re asking Treasury to align with existing programs, clarify already-allowed processes, and reduce friction where the guidance seems out of step with how fuel and feedstock markets actually work.
As the 45Z rulemaking process heads into a round of Review, the smart move isn’t to sit back and wait for final answers. It’s to pay attention to what others are signaling—and use that insight to sharpen your own tactical plan of implementation and access.
incite.ag Staff
———
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.
