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Last week, the U.S. Treasury Department released its proposed rule for Section 45Z. The proposal outlines a clear path to incorporate corn, soybeans, and other grains used in renewable fuel production into carbon intensity scoring. It also recognizes the value of on-farm production practices in determining biofuel emissions rates.

When fully implemented, this approach allows agricultural practices to directly contribute to higher Section 45Z credit values. Today’s announcement is meaningful progress, though a few steps remain before full implementation.

What still needs to happen

• USDA must publish the final version of the USDA Feedstock Carbon Intensity Calculator (FD-CIC), which was initially proposed last year.

• The FD-CIC must be incorporated into the 45Z-GREET model managed by the Department of Energy so it can be used to calculate carbon intensity adjustments for feedstocks.

• Treasury will issue additional guidance outlining how FD-CIC will be applied, including practice implementation, recordkeeping, and verification, alongside updates to the 45Z-GREET model.

What this means for Landus members

Landus is ready. As an early adopter, we have already built the infrastructure needed to support participation at scale. Our low-carbon-intensity grain pilot on the 2024 crop demonstrated this capability, and we are actively working with grain and oil customers to prepare for the final rules once they are released.

This is an important step forward for our members and customers and a milestone we have been working toward since 2023.

Follow Landus for updates as additional guidance becomes available. If you have any questions, reach out to me at sue.tronchetti@landus.ag or at 515-370-0232.