en.Wedoany.com Reported - On April 1, the U.S. Department of Agriculture submitted a final rule to the White House Office of Management and Budget, proposing to establish the "Technical Guidance for the Production of Biofuels Feedstocks from Regenerative Agriculture" and entering the interagency review process. This rule focuses on the quantification, reporting, and verification of low-carbon agricultural feedstocks, with the core objective of providing supporting rules for the Clean Transportation Fuels Program and the Clean Fuel Production Tax Credit.
From a policy evolution perspective, this final rule is a continuation and adjustment of the interim final rule issued in January 2025. At that time, the USDA proposed new regulations focusing on standardizing the greenhouse gas accounting methods for low-carbon domestic agricultural feedstocks and providing guidance for incorporating climate-smart agricultural practices into the biofuels feedstock system. According to the OMB's explanation in the Spring 2025 Regulatory Agenda, this rule could potentially create more market opportunities for low-carbon agricultural feedstocks and could also bring value-added markets for growers of biofuel feedstock crops.
The existing regulatory framework primarily covers three types of feedstocks: corn, sorghum, and soybeans, and specifies climate-smart agricultural practices that can reduce greenhouse gas emissions or increase carbon sequestration. These practices include reduced tillage and no-till, cover cropping, and nutrient management measures such as the use of nitrification inhibitors. The policy design intent is to incorporate emission reduction effects from the agricultural sector into the fuel sector's accounting system, thereby linking the feedstock production stage with the 45Z Clean Fuel Production Tax Credit policy.
The formation of this rule began in June 2024. At that time, the USDA issued a draft for public comment, soliciting input on how to quantify, report, and verify the impact of climate-smart agriculture on the greenhouse gas emissions of biofuel feedstocks. It received over 250 pieces of feedback and submitted the interim final rule to the OMB for review in December 2024. This latest submission of the final rule indicates that the USDA is continuing to revise or update specific provisions from the January 2025 version.
As of now, the OMB has not scheduled any stakeholder meetings related to this final rule, and the specific modifications have not been made public. For biofuel feedstock producers, the subsequent review results will influence how climate-smart agricultural practices are integrated into the clean fuel accounting system and will also affect the market access pathways for corn, sorghum, and soybean feedstocks in the low-carbon fuels market.
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