Alabama Alternative Fuel Producer
Biofuel Production Facility Tax Credit
Companies that invest in the development of a biofuel production facility may be eligible for a tax credit against the state income tax or financial institution excise tax liability generated by the project each year for up to 20 years in the amount equal to 5% of the capital costs of the project. For the purposes of the credit, biofuel is defined as a motor vehicle fuel that is produced from grain, starch, oilseeds, vegetable, algae, animal, or fish materials including fats, greases and oils, sugarcane, sugar beets, sugar components, tobacco, potatoes, and lignocellulosic or other biomass. In order to be eligible for the tax credit, the capital costs of the production facility must be at least $2,000,000 if the facility is not located in a favored geographic area, and $500,000 if the facility is located in a favored geographic area. A favored geographic area is defined as an area or county that is designated as an enterprise zone or is considered to be less developed by the Alabama Department of Industrial Relations. (Reference House Bill 568, 2009)
Biofuels Research and Development Support
The Alabama Research Alliance (ARA), administered by the Alabama Department of Economic and Community Affairs, facilitates scientific research and development, including agricultural research and development activities related to biofuels. Income received by the ARA may be used to support research and development activities. (Reference Executive Order 37, 2007)
Alternative Fuels Promotion and Information
The Center for Alternative Fuels (Center) was established within the Alabama Department of Agriculture and Industries to promote alternative fuels as a viable energy source in the state. The Center has been tasked with assessing the current status and development of sources of alternative fuels, ensuring that all alternative fuels sold in the state meet ASTM standards, and acting as an information center for alternative fuels and a clearinghouse for available federal grant funding for alternative fuel development. The Center has also been designated to administer a grant program funded by an income tax check-off program through the Alabama Alternative Fuels and Research Development Fund. (Reference Code of Alabama 2-2-90 and 2-2-91)
Interagency Alternative Fuels Working Group
The Alabama Legislature urges the Alabama Department of Finance to invite all state agencies, commissions, boards, counties, and municipalities to join an interagency Alternative Fuels Working Group to promote education, research and development, production, and consumption of alternative fuels. (Reference Senate Joint Resolution 16, 2009)
