May 29, 2026. The Transport Project (TTP) participated in the U.S. Department of Treasury’s 45Z Clean Fuel Production Tax Credit public hearing held on May 27-29, 2026.
TTP President Daniel Gage was the first to testify over the multi-day hearing, stressing the importance of timely completion of the rulemaking process and urging the Internal Revenue Service (IRS) to include the release of the required updated GREET model alongside the final 45Z rule.
“To fulfill its compliance obligations under the One Big Beautiful Bill Act (OBBBA), the final rule should specify individual carbon intensity scores for RNG based on individual manure types used in the fuel’s production,” said Gage. “Congress sent a clear message of support for RNG by recognizing the need to differentiate between the various RNG manure waste feedstocks. Treasury must work with the U.S. Department of Agriculture and the U.S. Department of Energy to expeditiously update the 45ZCF-GREET model to reflect the statutory language in the OBBBA.”
In addition, to more accurately account for fuel efficiency losses resulting from the blending of ethanol into gasoline used as a transportation fuel, Gage asked that IRS assign a gasoline gallon equivalent (GGE) energy content value that better aligns with U.S. Department of Energy fuel specification data. This value is critical for RNG producers as it will serve as the baseline in determining the number of 45Z credits earned for qualified fuels.
While reasonable to use E10 as the baseline, IRS assigned the upper bound energy content value in its proposed rule, which unfairly penalizes RNG producers who would have to generate even more fuel to qualify for a single credit. As such, TTP recommended IRS base this value on either the average of the range defined by DOE’s Alternative Fuel Data Center or the net value shown for E10 in the Oakridge National Laboratory’s Transportation Energy Databook. Doing so would revise the proposed GGE value to align with DOE heating values to better reflect real-world fuel specs so that RNG producers are not unfairly penalized in calculating earned credits under the program.
The 45Z credit was enacted in the Inflation Reduction Act of August 2022, took effect in January 2025, was improved and expanded in the One Big Beautiful Act of July 2025, and expires at the end of 2029.
The three-day hearing included testimony from over 75 individuals representing stakeholder interests in RNG as well as ethanol, biodiesel, renewable diesel, sustainable aviation fuel, and renewable hydrogen fuels. A final rule is expected this fall.