USDA finalizes 45Z feedstock rule and launches carbon intensity tool for biofuel supply chain

The USDA has finalized its 45Z feedstock rule, setting the requirements for which agricultural feedstocks qualify for the clean fuel production tax credit. Alongside the rule, the agency introduced a new carbon intensity calculation tool designed to help biofuel producers measure and report the lifecycle emissions of their supply chains. This matters because the 45Z credit is a key driver for low-carbon fuel production in the US. The new tool gives producers a standardized way to quantify emissions from farming, transport, and processing. Without clear carbon intensity data, producers cannot accurately claim the credit, and buyers cannot verify the climate benefit of the fuel they purchase. The rule and tool together aim to reduce uncertainty in the biofuel market. Producers now have a clearer path to compliance, and investors can better assess which feedstocks and production methods will deliver the lowest carbon intensity and highest credit value.