Biomass Producer or Collector Tax Credit

The Oregon Department of Energy (ODOE) has issued final rules regarding an increase in the application fee for this tax credit. The new fee is $100 plus 3.8 percent of the tax credit amount (previously $100 plus 2.5 percent of the tax credit).

 The Oregon Department of Energy provides a tax credit for agricultural producers or collectors of biomass.  The credit can be used for eligible biomass used to produce biofuel; biomass used in facilities such as those producing electricity from anaerobic digestion, pellets, or torrefaction also qualifies.  Biomass used as biofuel or used to produce biofuel - in a solid, liquid or gaseous state - qualifies for this tax credit.  The production or collection of biomass must take place in Oregon and must also be used in Oregon.  Certain types of biomass are ineligible for this credit, including biomass to be used for firewood or charcoal, construction and demolition debris, urban wood waste, yard debris, residual wood waste generated at a mill (such as sawdust or bark), algae, and material from pre-construction or construction activities and golf courses. The tax credit rates are multiplied by the amount of biomass produced or collected and vary by biomass type, as follows:

• Oil seed crops: $0.05/pound
• Grain crops: $0.90/bushel
• Virgin oil or alcohol: $0.10/gallon
• Used cooking oil or waste grease: $0.10/gallon
• Wastewater biosolids: $10/wet ton
• Woody biomass: $10/dry ton
• Vegetative biomass from agricultural crops: $10/dry ton
• Animal manure or rendering offal: $5/wet ton

The credit can be transferred to another taxpayer, though the minimum discount value for the transfer of the credit is 90% of the value of the tax credit.  This tax credit is available for tax years beginning prior to January 1, 2018.