Biodiesel Plant Closure Highlights Need For Policy Solutions

The following has been written by the Wisconsin Soybean Program.

The Wisconsin Soybean Association (WSA) and Wisconsin Soybean Marketing Board (WSMB) are extremely disappointed in the announcement that Chevron is indefinitely shutting down its biodiesel facility in Madison. 

“With crop prices dropping and input costs stubbornly high, this news is unwelcomed and disheartening for our farmers,” WSA President Sara Stelter said. “We recognize that this is a complex situation. But the pause on production in these plants is more stark evidence that Wisconsin’s legislative leaders should look at how neighboring states have supported legislation that uplifts the biofuels industry.”  

There are several legislative solutions to address ongoing uncertainty in the biofuels market. Last fall, WSA issued its endorsement of Senate Bill 454 in the Wisconsin Legislature. The legislation would create a program within the Wisconsin Department of Agriculture, Trade and Consumer Protection (DATCP) to provide $8 million in matching grants to Wisconsin fuel retailers to upgrade their equipment to make it compatible with higher blends of ethanol as well as biodiesel.   

In 2023, the country’s consumption and production of biomass-based diesel increased by 1 billion gallons over the previous year. The American Soybean Association also supports federal tax credits that improve the biofuels industry.  

Biodiesel directly benefits Wisconsin soybean growers. Both WSA and WSMP continue to strongly support implementing policies and initiatives that encourage the adoption of biofuels. B20 (20 percent biodiesel) adds nearly $2 to every bushel of soybeans and increases demand for soybeans by 13%. With the potential for growth in the sustainable aviation fuel market, Wisconsin is missing a huge economic and environmental opportunity by not creating a more favorable environment for biofuels to thrive.  

“Thanks to farmers’ checkoff investments for over 20 years, biodiesel creates jobs across Wisconsin and has helped add to farmer profitability,” said Adam Kask, executive director of WSMB. “We are hopeful this serves as a wake-up call across the industry.”