EMA Regulatory Alert: Treasury and IRS Propose Section 45Z Tax Credit Rules
The U.S. Department of the Treasury and the Internal Revenue Service have issued proposed regulations providing guidance to domestic producers of clean transportation fuel on eligibility for, and calculation of, the section 45Z Clean Fuel Production Credit, as amended by the One, Big, Beautiful Bill (OBBB). The section 45Z credit provides an income tax credit for qualifying clean transportation fuel produced in the United States and sold through December 31, 2029.
| Click Here for the Full Regulatory Alert |
EMA Regulatory Alert: Regional Hours of Service Waiver Extended Due to Ongoing Winter Storms
EMA Regulatory Counsel Contacts: Jeff Leiter and Jorge Roman
The Federal Motor Carrier Safety Administration (FMCSA) extended the
40-state regional emergency declaration in response to ongoing impacts
of severe winter storms and below normal temperatures across much of the
United States. This extension continues to grant an Hours of Service
(HOS) waiver for motor carriers transporting essential goods and
services, including fuel, until the end of the emergency or through
12:59 PM (ET) February 20––whichever is earlier.
Scope of the Extended Declaration
The extended declaration applies to 40 states and
jurisdictions, including:
ALABAMA, ARKANSAS, COLORADO, CONNECTICUT, DELAWARE, DISTRICT OF
COLUMBIA, FLORIDA, GEORGIA, ILLINOIS, INDIANA, IOWA, KANSAS, KENTUCKY,
LOUISIANA, MARYLAND, MASSACHUSETTS, MICHIGAN, MISSISSIPPI, MINNESOTA,
MISSOURI, MONTANA, NEBRASKA, NEW HAMPSHIRE, NEW JERSEY, NEW YORK, NORTH
CAROLINA, NORTH DAKOTA, OHIO, OKLAHOMA, PENNSYLVANIA, RHODE ISLAND,
SOUTH CAROLINA, SOUTH DAKOTA, TENNESSEE, TEXAS, VERMONT, VIRGINIA, WEST
VIRGINIA, WISCONSIN, AND WYOMING.
The declaration waives HOS requirements for the interstate transportation of all fuels as essential supplies, including but not limited to:
Gasoline
Diesel (including diesel used to fuel generators and snow removal equipment)
Kerosene
Jet fuel
Diesel additives
Heating fuels and heating oils
Propane
Important: the FMCSA waiver applies to the interstate transportation
of fuel into and out of the covered states and jurisdictions. The relief
remains in effect even when vehicles travel through states not listed in
the declaration, provided the shipment is destined for a covered state.
However, the waiver does not apply to intrastate-only shipments, meaning
deliveries that occur entirely within a single state.
Important: This relief ends when a driver or vehicle is dispatched to
resume normal commercial operations unrelated to the emergency. Drivers
transitioning from emergency relief to normal operations must take a
required rest break—10 hours for property carriers—once applicable
duty-hour thresholds are met.
| Full declaration: ESC-MSC-SSC-WSC – Extension of Regional Emergency Declaration - No. 2026-001 - 02-03-2026 |
The Energy Marketers of America will continue to work closely with FMCSA, the Department of Energy (DOE), the Department of Homeland Security (DHS), FEMA, and other federal agencies to support emergency preparedness efforts and to address any issues that arise in response to the recent winter storms.
EMA, NACS and Industry Coalition Support the Exclusion of EVs from CAFE Standards
On December 5, 2025, the National Highway Traffic Safety Administration (NHTSA) proposed new Corporate Average Fuel Economy (CAFE) standards for Model Years 2022–2031 for passenger cars and light trucks. EMA worked with industry stakeholders, including NACS and NATSO, to support the agency’s decision to exclude electric vehicles (EVs) and electric-only performance from the CAFE standard-setting process.
The proposal would correct key legal flaws in the current standards by excluding EVs from the agency’s determination of “maximum feasible” fuel economy levels—a change the associations strongly support as both legally required and sound policy.
Restoring Compliance with EPCA
At the core of the comments is a straightforward statutory point: the Energy Policy and Conservation Act (EPCA) does not permit NHTSA to consider EVs when setting fuel economy standards. EPCA expressly bars the agency from considering battery electric vehicles, which operate solely on electricity, and requires plug-in hybrid vehicles to be treated as if they operate only on gasoline or diesel fuel. Fuel economy is defined in terms of miles traveled per unit of fuel—confirming that the CAFE program is designed to regulate vehicles that consume motor fuels.
The current CAFE standards departed from these statutory limits by effectively using EV performance to ratchet up stringency across the fleet. NHTSA has now acknowledged that approach was unlawful, and the associations strongly support the agency’s effort to restore a lawful baseline.
The comments also explain that using CAFE standards to force a nationwide transition to EVs raises serious concerns under the major questions doctrine. Mandating electrification through fuel economy standards is an economically and politically significant policy choice—one Congress has repeatedly debated and declined to adopt. Nothing in EPCA provides the “clear congressional authorization” required for NHTSA to impose such a mandate indirectly.
“EPCA is an energy-efficiency statute, not an energy-substitution one. The law was enacted to improve fuel efficiency––not to impose a resource shifting mandate that restructures the automotive market by compelling a transition from one propulsion technology to another,” said EMA Regulatory Counsel Jorge Roman.
Better Policy Outcomes for Motorists
Aside from the statutory boundaries of EPCA, excluding EVs from the CAFE calculus will lead to better real-world outcomes. By returning to performance-based standards focusing on improvements to internal combustion engine (ICE) vehicles, the proposal can unlock innovation in both ICE technologies and liquid fuels. Additionally, avoiding a force transition can preserve consumer choice and affordability for motorists.
“Allowing CAFE standards to function as a backdoor mechanism for regulating emissions or forcing fleetwide electrification is contrary to both the plain language of the statute and its legislative intent,” said EMA President Rob Underwood. “We will continue to make the case that CAFE is an energy-efficiency program—not a vehicle electrification mandate.”
EMA Calls for Permanent Year-Round E15 Waiver
In a recent letter to U.S. Representatives Randy Feenstra (R-IA) and Stephanie Bice (R-OK), Rob Underwood, President of the Energy Marketers of America (EMA), outlined the organization's strong support for policies aimed at enhancing energy security, economic growth, and consumer options in the fuel sector. Representing a federation of 48 state and regional trade associations, EMA emphasized the critical role of family-owned energy marketers in America's fuel distribution network.
A key focus of the letter was EMA's endorsement of legislation to establish a permanent nationwide waiver for year-round sales of E15 gasoline—a blend containing 15 percent ethanol. This position was formalized last October when EMA's Board of Directors voted in favor of the measure. The bipartisan Nationwide Consumer and Fuel Retailer Choice Act (S.593/H.R.1346) would extend the Reid Vapor Pressure (RVP) waiver currently applied to E10 blends, preventing the creation of fragmented "boutique" gasoline markets in Midwestern states that have opted out of the E10 waiver.
Underwood highlighted the potential downsides of such boutique markets, including disrupted gasoline supplies, increased costs, and reduced fuel fungibility. These issues could ultimately drive-up prices at the pump for consumers. "Passing this permanent waiver is essential to maintaining a stable and efficient fuel market," he stated, noting that EMA has consistently raised alarms about the risks to supply chains and affordability.
The letter also advocated for increased investments in the Higher Blends Infrastructure Incentive Program (HBIIP), an initiative launched during the first Trump Administration. To date, HBIIP has allocated $537 million to support 543 projects across 29 states, providing cost-share grants for upgrades at fueling stations and distribution facilities. These enhancements enable the handling of higher biofuel blends like E15, E85, and B20 biodiesel.
Underwood argued that bolstering HBIIP would expand access to American-made biofuels, generate well-paying jobs in rural areas, diversify energy supplies, and shield farmers from market fluctuations. "This program has proven its value in building out the infrastructure needed for a more resilient energy future," he wrote, calling on Congress to prioritize additional funding to accelerate these benefits.
On the topic of small refinery exemptions (SREs) under the Renewable Fuel Standard (RFS), EMA maintains a neutral position regarding future issuances. However, the organization firmly opposes the reallocation of previously waived SREs, warning that such moves could introduce unnecessary volatility into the market. When non-exempt refiners must compensate for exempted volumes, prices for Renewable Identification Numbers (RINs) can spike unpredictably, complicating efforts by EMA members to offer competitive pricing. Given their reliance on branded and unbranded supplies and limited flexibility, downstream marketers could face significant challenges, including disruptions in local fuel distribution and threats to economic viability. "Any reallocation must carefully consider the downstream impacts to avoid harming the very communities we serve," Underwood emphasized.
Underwood expressed EMA's eagerness to collaborate with Representatives Feenstra and Bice who are co-chairs of the E15 Council, as well as congressional leadership including House Speaker Mike Johnson, Senate Majority Leader John Thune, Senate Minority Leader Chuck Schumer, and House Minority Leader Hakeem Jeffries. "We stand ready to advance these policies for a prosperous future," he concluded, reiterating the importance of balanced approaches that support energy marketers, agricultural producers, and everyday consumers.
For more information or to discuss this in further detail, please contact Rob Underwood.
The House of Representatives has passed H.R. 7148, the Consolidated Appropriations Act, a $1.3 trillion legislative package that includes five fiscal year 2026 appropriations bills. On Tuesday President Trump signed the measure into law ending the partial government shutdown. This resolution accounts for 96 percent of the federal government’s annual funding, successfully passing 11 of the 12 required spending bills. However, the Department of Homeland Security (DHS) remains the sole outstanding funding bill, currently operating under a two-week extension to allow for further negotiations between Congress and the White House. These upcoming discussions will focus on modifying DHS spending to address specific policy concerns, particularly those involving recent actions by U.S. Customs and Border Protection (CBP) and Immigration and Customs Enforcement (ICE).
The Trump administration, through the Bureau of Ocean Energy Management (BOEM), has scheduled the BBG2 oil and gas lease sale for March 11, 2026, offering over 80 million acres in the renamed "Gulf of America". Mandated by the "One Big Beautiful Bill Act," which requires 30 lease sales through 2040, this initiative seeks to bolster U.S. energy independence with a set royalty rate of 12.5%. While the sale excludes protected areas like the Flower Garden Banks and waters near Florida, a draft five-year plan proposes expanding drilling into the High Arctic and off the California coast. These aggressive expansion efforts have triggered lawsuits from environmental groups over the lack of environmental reviews and faced bipartisan opposition from congressional delegations in states like Florida, Alaska, and California.
In a recent meeting on Capitol Hill, Federal Energy Regulatory Commission (FERC) leaders discussed their efforts to streamline environmental reviews under the National Environmental Policy Act (NEPA) by limiting their scope to issues within the agency's jurisdiction, following a 2024 Supreme Court ruling. Key changes include no longer analyzing indirect greenhouse gas (GHG) emissions from upstream production or downstream combustion and ceasing to use GHG emissions as a basis for requiring resource-heavy environmental impact statements. To increase efficiency, FERC has instructed staff to simultaneously draft project orders and environmental review documents, a process that has accelerated some project approvals by up to 30 percent. These internal process changes are occurring as Congress negotiates potential NEPA reforms intended to further reduce approval times and prevent project cancellations often caused by litigation over deficient environmental analyses.
EPA Mandates DEF System Data Submission from Diesel Engine Manufacturers
In a significant development for the diesel industry, the U.S. Environmental Protection Agency (EPA), led by Administrator Lee Zeldin, has issued a directive requiring major diesel engine manufacturers to provide comprehensive data on Diesel Exhaust Fluid (DEF) system failures. Announced on February 3, 2026, this initiative gives manufacturers just 30 days to comply, with a focus on addressing persistent issues that have plagued truckers, farmers, and other operators of diesel-powered equipment.
The EPA's request targets data from key model years—2016, 2019, and 2023—including failure rates, repair details, and warranty claims. The goal is to independently evaluate whether these problems stem from specific designs or product generations. Common complaints include sudden engine derates, loss of speed, and complete shutdowns, which not only disrupt productivity but also raise serious safety concerns on the road and in the field. Non-compliance with this data submission could lead to substantial penalties under the Clean Air Act.
This action builds on the EPA's August 2025 guidance, which urged manufacturers to implement software updates for existing fleets. These updates aim to mitigate severe derates by providing extended warnings—such as 650 miles or 10 hours for initial faults, followed by milder restrictions for up to 4,200 miles. For nonroad equipment, like agricultural machinery, the guidance permits up to 36 hours of operation before any torque reduction. Looking forward, model year 2027 on-road trucks will be required to eliminate sudden power losses entirely when DEF levels are low.
Additionally, a clarification issued on February 2, 2026, reinforces farmers' rights to repair nonroad diesel equipment, including DEF systems, without risking warranty invalidation under the Clean Air Act. DEF systems, introduced in 2010 to support selective catalytic reduction (SCR) technology and meet stringent NOx emission standards, have faced ongoing criticism due to sensor malfunctions, crystallization problems, and overly aggressive inducement strategies that can leave vehicles stranded.
By compelling the top 14 manufacturers—who represent over 80 percent of the market—to submit detailed data, the EPA is positioning itself to drive improvements in system designs and materials. This could translate to fewer breakdowns, reduced repair costs, and more efficient fuel utilization, ultimately stabilizing diesel demand in critical sectors like transportation and agriculture.
Fewer disruptions mean more consistent operations for end-users, supporting steady diesel consumption and distribution. The collected data will also inform upcoming 2026 rulemaking, potentially leading to revisions or withdrawals of elements from the 2022 heavy-duty NOx rule. Such changes could prioritize practical solutions that maintain emissions compliance without unnecessary operational penalties.
January 2026 Energy Marketers of America Small Business Committee (SBC) PAC Contributions
PAC Co-Chairs Mike Downs and Tim Keigher are grateful for the EMA Small Business Committee (SBC) PAC contributions from the following individuals during the January 1-31, 2026 time frame:
Alabama: Michael Anderson, Richard W. Alston, William Bowser, Cameron Bruce, Colby Chambers, Keith Chambers, Anne Marie Claburn, James Cochran, Chris D'Amico, Brandon Evans, Rex Jones, Brock Hill, Max Kinsey, Christopher Little, Thomas Myers, Dustin Smith, Paul Smith, M. L. Smutherman, Cindy Thomas, Lyn Thornton, Rodney Walker
Missouri: Brent Anderson, Steve Ayers, Brian Baker, Wayne Baker, Jack Blanton, Mary Braddock, Scott Frazier, Tony Gier, Bradford Goette, Bryan Goforth, Michelle Hoerstkamp, Tracey Hughes, Jami Jordan, Thomas Kolb, Ron Leone, Jim Maurer, Don McNutt, Jeffrey Adam Naegler, Chris Patterson, Janice Patterson, Lane Paterson, Chad Wallis, Lynn Wallis, Jeff Wood, Laura Younghouse
New York: Jason Mirabito, Brandon Smith
Pennsylvania: Bruce Spiridonoff
South Carolina: Michael Fields
Texas: Bobby Warren
Virginia: Lewis Wall Jr.
Washington: Steven Clark
DOT inquiry signals new era of scrutiny for electric trucks | yahoo!news
Credit Card ‘Swipe’ Fees Could Cost Consumers $683 Million on Valentine’s Day
Federated Insurance Risk Management Academy Complimentary
Webinar
Protect Your Future with Estate and Business Succession
Planning: Thursday, February 19, 2026, 2:00 P.M. Eastern
Time
Have you planned for the future of your business? Planning ahead can help to reduce risks to keep operations running smoothly if you are no longer able to make decisions on behalf of your business. This webinar will explore top legal issues that individuals and business owners may face, and discuss the following:
How personal estate plans can shape future generations.
Employee retention strategies.
Business entity structure.
Corporate document upkeep.
Liability and asset protection ability and asset protection.
WHAT YOU WILL LEARN
Why personal estate planning is important.
The importance of business succession planning for your family and business.
Planning strategies now and for the future.
Advanced registration is required for this 30-minute webinar.
For additional information or to discuss this in further detail, please contact your Federated regional representative or EMA’s National Account Executive Jack West at 262.719.7750 for any additional information or risk management questions. Federated is a Partner in EMA’s Board of Directors Council.
At Federated Insurance, It’s Our Business to Protect Yours®
EMA Member Services Spotlight Featuring: National Purchasing
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