The state of Oregon offers a tax credit to producers and collectors of biomass that is used in Oregon as biofuels, or to produce biofuels or biogas. Oregon Department of Energy has entered rulemaking to implement changes made by HB 3672 during the 2011 legislative session. HB 3672 changed the credit rate from $10 per green ton to $10 per bone dry ton from woody biomass, grass, wheat and straw, and other vegetative matter from agricultural crops.  

The draft rule would eliminate food processing residues from eligibility for this tax credit. This would financially disadvantage the food processing sector and have a detrimental impact on development of food processing residue-based biogas projects in Oregon. HB 3672 did not exclude food processing residues, nor does the original statute.  ODOE is going beyond statutory authority.

NWFPA opposes the credit rate change to bone dry ton as it would apply to food processing residues. This change also represents a departure from the current statute. NWFPA presented testimony at August 16, 2011 hearing and submitted written comments on August 18, 2011 opposing the food processing residue exclusion and the bone dry ton rate. ODOE anticipates final rules in October 2011.