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Today, the e-NG Coalition submitted its response to the U.S. Department of the Treasury’s proposed regulations on the Section 45Z Clean Fuel Production Credit, an important policy framework that will shape how low-carbon fuels are recognized and supported in the United States.
In the submission, we welcomed several important clarifications in the proposed rule that are highly relevant to the development of e-NG (electric natural gas / e-methane) and other e-fuels, while also identifying areas where further clarification or adjustment would be necessary to ensure that the final framework remains practical, investment-friendly and aligned with the realities of emerging clean fuel markets.
Our response also reaffirmed the role that e-NG can play in supporting domestic clean fuel production, energy security, industrial competitiveness, and long-term decarbonization. Produced from electricity, water and CO₂, e-NG is a synthetic methane that can be stored, transported and used through existing natural gas infrastructure, making it a practical and scalable pathway for low-carbon fuel deployment.
Among the elements we welcomed in the proposed rule were the clarifications on gas quality and interchangeability requirements, which help confirm that alternative gaseous fuels can qualify once produced in a form that is interchangeable with fossil natural gas. The recognition of intermediate sales was also particularly welcome, as it reflects the commercial reality of modern fuel markets, where distributors, aggregators, and marketers play a central role in connecting producers with end users.
The inclusion of a Provisional Emission Rate (PER) process was likewise identified as a meaningful step forward. This creates an important pathway for innovative fuels that are not yet fully reflected in existing emissions models, helping to ensure that emerging technologies can participate in the credit while lifecycle methodologies continue to evolve.
At the same time, we also pointed to areas where additional clarity would strengthen the final rule. One key issue concerns the treatment of alternative natural gas used as a process of fuel in the production of another eligible transportation fuel. In our view, where such fuels are used solely as process energy — rather than as a primary feedstock — this should not prevent downstream fuel from remaining eligible under Section 45Z, provided all other requirements are met.
Clarifying this point would help reduce uncertainty for producers and better reflect the operational realities of low-carbon fuel production pathways.
We also called for a more practical and scalable framework for electricity attribution under Section 45Z. While the proposed rule allows for the use of renewable electricity certificates (RECs), we cautioned against introducing overly restrictive requirements related to additionality, deliverability, and temporal matching. Such constraints could increase compliance costs, limit access to clean electricity, and ultimately undermine the competitiveness of emerging fuels.
Instead, we recommended a more streamlined approach that preserves environmental integrity while remaining aligned with existing market practices and enabling cost-effective deployment.
Our response also encouraged the inclusion of additional pathways for demonstrating low-carbon electricity use, including approaches based on real-time grid conditions such as renewable overgeneration, curtailment or sustained low wholesale electricity prices. These mechanisms could help improve overall system efficiency, reduce production costs, and accelerate the deployment of low-carbon fuels.
As clean fuel policy continues to evolve in the United States, the e-NG Coalition remains committed to contributing constructively to the regulatory discussions shaping the future of low-carbon fuels.
We look forward to continued engagement with U.S. policymakers and stakeholders to help ensure that the final Section 45Z framework supports credible, practical and scalable pathways for clean fuel deployment, including for e-NG and other electrofuels.
Read the full text of the comments from e-NG Coalition at our Policy section.
