The bill establishes a tax credit for retail dealers and distributors in Kansas who sell biodiesel and renewable diesel blends for motor vehicle fuels during the taxable years 2026 through 2031. Specifically, the credit amounts to $0.05 per gallon sold, applicable to biodiesel blends containing at least 10% biodiesel and renewable diesel blends of the same percentage. The total tax credits issued under this provision are capped at $5,000,000 per tax year, and any unused credits can be carried forward for up to five years. Notably, the credit is non-refundable.

Additionally, the bill defines key terms related to biodiesel and renewable diesel, including "biodiesel blend," "biodiesel fuel," "distributor," "renewable diesel," and "retail dealer." It specifies that biodiesel produced from palm oil is excluded unless derived from waste oil and grease collected within the U.S. The act will take effect upon its publication in the statute book.