Comment from American Carbon Alliance

Subject: Comments on Section 45Z Clean Fuel Production Credit (REG-121244-23) The American Carbon Alliance (ACA) appreciates the opportunity to provide comments on the proposed guidance for the Section 45Z Clean Fuel Production Credit. ACA represents a broad coalition of stakeholders across agriculture, energy, and rural America committed to advancing practical, market-driven solutions that reduce carbon intensity while strengthening domestic energy production and economic growth. Section 45Z presents a critical opportunity to align U.S. agriculture, energy production, and innovation in a way that delivers meaningful benefits to farmers, rural communities, and the broader economy. The success of this credit will depend on whether the final rule provides clear, durable, and economically viable guidance that supports investment and market development across the full value chain. The urgency of this opportunity is heightened by current conditions in the agricultural economy. Farmers across the United States are facing sustained pressure from lower commodity prices, rising input costs, and tightening margins. In this environment, the development of new markets for agricultural products is not optional — it is essential. Section 45Z has the potential to create meaningful new demand for American-grown feedstocks, providing a critical economic outlet at a time when it is needed most. In addition to sustainable aviation fuel, the final rule should recognize and support emerging market opportunities for low-carbon fuels and products, including: •The use of low-carbon ethanol and other biofuels in marine fuel applications, where there is growing interest in lower-emission solutions for shipping •The development of renewable chemicals and low-carbon industrial products, which expand the value of agricultural feedstocks beyond traditional fuel markets •The potential for fertilizer and other agricultural inputs derived from low-carbon processes, further integrating energy and agricultural systems Expanding these markets will be critical to ensuring that Section 45Z drives broad-based economic benefits and supports long-term demand for U.S. agriculture. The rule should also fully recognize the importance of carbon capture, utilization, and storage as part of an integrated energy and industrial system. In particular, carbon dioxide utilization pathways, including enhanced oil recovery and the production of low-carbon products, play an important role in improving project economics and enabling emissions reductions across multiple sectors. Enhanced oil recovery is especially important to U.S. energy security. A significant majority of oil reserves — often estimated at 80+ percent — remains unrecovered after primary and secondary production and cannot be produced without the use of CO₂-based enhanced oil recovery. Ensuring a reliable and plentiful supply of CO₂ for these applications will be critical to maintaining domestic energy production and reducing reliance on foreign sources. Finally, Treasury should ensure that lifecycle modeling and credit implementation provide the certainty necessary to support investment at scale. Clear and consistent treatment of emissions reductions, including agricultural practices and carbon management, will be essential to unlocking participation across the value chain. Section 45Z represents a rare opportunity to simultaneously strengthen American agriculture, expand domestic energy production, and support innovation across multiple industries. A final rule that provides clarity, flexibility, and durability will allow these benefits to be fully realized. ACA appreciates Treasury’s leadership on this rulemaking and stands ready to continue engaging to ensure successful implementation. Sincerely, Tom Buis CEO American Carbon Alliance