Maryland Incentives and Laws for Ethanol
The list below contains summaries of all Maryland incentives and laws related to Ethanol.
State Incentives
Cellulosic Ethanol Research and Development Tax Credit
An individual or corporation may claim a credit against the state income tax of up to 10% for qualified research and development expenses for cellulosic ethanol technology. The total credit may not exceed $250,000 per calendar year. If the credit allowed exceeds the tax liability of the individual or corporation for that taxable year, the credit may be applied for up to 15 future taxable years after the qualified expenses were incurred. This tax credit does not apply to qualified expenses incurred after December 31, 2016. (Reference Maryland Statutes Tax-General Code 10-205j, 10-306f, and 10-726)
Biofuels Production Incentive
Qualified ethanol and biodiesel producers are eligible for production incentives on a per gallon basis. To be eligible for the incentive, the producer must first apply for and receive certification from the Renewable Fuels Incentive Board (Board). Credits are offered to certified producers in Maryland for ethanol or biodiesel produced between December 31, 2007, and December 31, 2017.
Ethanol production credits are as follows: a) $0.20 per gallon of ethanol produced from small grains such as wheat, rye, triticale, oats, and hulled or hull-less barley; or b) $0.05 per gallon of ethanol produced from other agricultural products. The Board may not certify ethanol production credits for more than a total of 15 million gallons per calendar year, of which at least 10 million gallons must be produced from small grains.
Biodiesel production credits are as follows: a) $0.20 per gallon of biodiesel produced from soybean oil (the soybean oil must be produced in a facility or through expanded capacity of a facility that began operating after December 31, 2004), or b) $0.05 per gallon for biodiesel produced from other feedstocks, including soybean oil produced in a facility that began operating on or before December 31, 2004. The Board may not certify biodiesel production credits for more than a total of five million gallons per calendar year, of which at least two million gallons must be from soybean oil produced in a facility as described above.
(Reference Maryland Statutes, Agriculture Code 10-1501 through 10-1507)
Laws and Regulations
Alternative Fuel Use Requirement
At least 50% of state vehicles must use a minimum biodiesel blend of 5% (B5). This requirement does not apply to any state vehicles for which the use of biodiesel will void the manufacturer's warranty for that vehicle. Additionally, bi-fuel and flexible fuel vehicles capable of operating on either alternative fuel or conventional fuel must use alternative fuel when it is available. (Reference Maryland Statutes, State Finance and Procurement Code 14-408, and Policies and Procedures for Vehicle Fleet Management)
