The Renewable Natural Gas Incentive Act of 2025 creates a new federal tax credit of $1.00 per gallon for renewable natural gas (compressed or liquefied gas made from biomass) used as fuel in motor vehicles, boats, and aircraft. The credit applies to both pure renewable natural gas and blended mixtures, as long as producers register with the IRS and certify the fuel's origin and energy content. The bill also allows the government to make direct payments to businesses that sell or use qualifying renewable natural gas, ensuring they receive the full tax benefit. The law takes effect for fuel sold or used after December 31, 2025, and expires on December 31, 2035. The legislation aims to reduce greenhouse gas and air quality-damaging emissions from transportation while creating jobs in the renewable energy sector.
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