[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 1252 Introduced in Senate (IS)]
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119th CONGRESS
1st Session
S. 1252
To amend the Internal Revenue Code of 1986 to promote the increased use
of renewable natural gas, to reduce greenhouse gas emissions and other
harmful transportation-related emissions that contribute to poor air
quality, and to increase job creation and economic opportunity
throughout the United States.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 2, 2025
Mr. Tillis (for himself and Mr. Warner) introduced the following bill;
which was read twice and referred to the Committee on Finance
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to promote the increased use
of renewable natural gas, to reduce greenhouse gas emissions and other
harmful transportation-related emissions that contribute to poor air
quality, and to increase job creation and economic opportunity
throughout the United States.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Renewable Natural Gas Incentive Act
of 2025''.
SEC. 2. INCREASED CREDIT FOR RENEWABLE NATURAL GAS.
(a) In General.--Section 6426 of the Internal Revenue Code of 1986
is amended--
(1) in subsection (a)(2), by inserting ``and (l)'' after
``subsection (d)'', and
(2) by adding at the end the following new subsection:
``(l) Renewable Natural Gas Fuel Credit.--
``(1) In general.--For purposes of this section, the
renewable natural gas fuel credit is the product of $1.00 and
the number of gallons of renewable natural gas or gasoline
gallon equivalents of a nonliquid renewable natural gas sold by
the taxpayer for use as a fuel in a motor vehicle or motorboat,
sold by the taxpayer for use as a fuel in aviation, or so used
by the taxpayer.
``(2) Renewable natural gas.--For purposes of this section,
the term `renewable natural gas' means compressed or liquefied
gas derived from biomass (as defined in section 45K(c)(3))--
``(A) which was produced by a person registered
under section 4101(a), and
``(B) with respect to which the producer has made a
certification described in paragraph (4).
``(3) Treatment of blended renewable natural gas.--
``(A) In general.--Under regulations prescribed by
the Secretary, a sale of blended renewable natural gas
shall be treated as a sale of renewable natural gas
fuel if--
``(i) at the time the renewable natural gas
was blended with other compressed or liquefied
natural gas, the taxpayer had a contract with
the registered producer of such renewable
natural gas for the sale of such gas for use as
a fuel in a motor vehicle or motorboat, or for
use as a fuel in aviation,
``(ii) such contract was entered into
before the sale of the blended renewable
natural gas and specifies the number of gallons
of renewable natural gas provided for such
purposes and the period for which such contract
is in effect, and
``(iii) the registered producer of such
fuel provides to the taxpayer the certification
described in paragraph (4).
``(B) Limitation.--The amount of blended renewable
natural gas treated as renewable natural gas under
subparagraph (A) for any period shall not exceed the
number of gallons of renewable natural gas specified
under subparagraph (A)(ii) and certified by the
producer under paragraph (4) for such period.
``(C) Blended renewable natural gas.--For purposes
of this subsection, the term `blended renewable natural
gas' means compressed or liquefied natural gas which
consists of both renewable natural gas and other
compressed or liquefied natural gas.
``(4) Certification.--A certification is described in this
subparagraph if such certification--
``(A) identifies the product produced and the
gallon equivalent of fuel acquired by the taxpayer for
a purpose described in paragraph (1), and
``(B) is provided such form and manner as
prescribed by the Secretary.
``(5) Gasoline gallon equivalent.--For purposes of this
subsection, the term `gasoline gallon equivalent' means, with
respect to any nonliquid renewable natural gas, the amount of
such fuel having a Btu content of 124,800 (higher heating
value).
``(6) Termination.--This subsection shall not apply to any
sale or use for any period after December 31, 2035.''.
(b) Application of Other Rules.--
(1) Registration.--The last sentence of section 6426(a) of
the Internal Revenue Code of 1986 is amended by striking
``subsections (d) and (e)'' and inserting ``subsections (d),
(e), and (l)''.
(2) Denial of double benefit.--Section 6426(h) of such Code
is amended by striking ``subsection (d) or (e)'' and inserting
``subsection (d), (e), or (l)''.
(3) Fuel must be connected to the united states.--Section
6426(i) of such Code is amended by inserting after paragraph
(2) the following new paragraph:
``(3) Renewable natural gas.--No credit shall be determined
under this section with respect to any renewable natural gas
which is produced outside the United States for use as a fuel
outside the United States.''.
(4) Energy equivalency.--Section 6426(j) of such Code is
amended--
(A) by inserting ``or renewable natural gas,''
after ``alternative fuel'', and
(B) by inserting ``or gas'' after ``such a fuel''.
(c) Payments.--
(1) In general.--Section 6427(e) of the Internal Revenue
Code of 1986 is amended by redesignating paragraphs (3) through
(6) as paragraphs (4) through (7), respectively, and by
inserting after paragraph (2) the following new paragraph:
``(3) Renewable natural gas.--If any person sells or uses
renewable natural gas (as defined in section 6426(k)(2)) for a
purpose described in section 6426(k)(1) in such person's trade
or business, the Secretary shall pay (without interest) to such
person an amount equal to the renewable natural gas fuel credit
with respect to such fuel.''.
(2) Termination.--Section 6427(e)(7) of such Code, as
redesignated by paragraph (1), is amended by striking ``and''
at the end of subparagraph (D), by striking the period at the
end of subparagraph (E) and inserting ``, and'', and by adding
at the end the following new subparagraph:
``(F) any renewable natural gas (as defined in
section 6426(k)(2)) sold or used after December 31,
2035.''.
(3) Conforming amendments.--
(A) Section 6427(e)(4) of such Code, as
redesignated by paragraph (1), is amended--
(i) by striking ``paragraph (1) or (2)''
and inserting ``paragraph (1), (2), or (3)'',
and
(ii) by striking ``any mixture or
alternative fuel'' and inserting ``any mixture,
alternative fuel, or renewable natural gas''.
(B) Section 6427(e)(6) of such Code, as
redesignated by paragraph (1), is amended by striking
``alternative fuel credit or alternative fuel mixture
credit'' and inserting ``alternative fuel credit,
alternative fuel mixture credit, or renewable natural
gas fuel credit''.
(C) Section 6427(e)(6) of such Code, as
redesignated by paragraph (1), is amended--
(i) by striking ``paragraph (1) or (2)''
and inserting ``paragraph (1), (2), or (3)'',
and
(ii) by striking ``any mixture or
alternative fuel'' and inserting ``any mixture,
alternative fuel, or renewable natural gas''.
(d) Registration.--Section 4101(a) of such Code is amended--
(1) by striking ``and'' before ``every person producing
second generation biofuel'', and
(2) by inserting ``, and every person producing renewable
natural gas (as defined in section 6426(k)(2))'' after ``(as
defined in section 40(b)(6)(E))''.
(e) Effective Date.--The amendments made by this section shall
apply to fuel sold or used in calendar quarters beginning after the
date of the enactment of this Act.
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