GettyImages-1488179335_50034

The long-awaited pathway allows clean fuel producers whose fuel types, feedstocks, or pathways fall outside the emissions rate table to secure Provisional Emissions Rates.

By Joshua T. Bledsoe, Scott W. Cockerham, Michael Dreibelbis, Eli M. Katz, and Phil Goldberg

Key Points:

  • The Notice opens a pathway for clean fuel producers to seek an emissions value for fuels that do not fit within the published emissions rate table.

On October 16, 2026, the US Department of Energy (DOE) published a notice of availability in the Federal Register (FR Doc. 2026-21217) (Notice) announcing the availability of the Emissions Value Request Process in support of the Treasury Department’s and Internal Revenue Service’s (IRS’) administration of the Section 45Z Clean Fuel Production Credit (45Z Credit). Producers can now use the Emissions Value Request Process to obtain an emissions value from DOE, which supports a petition for a provisional emissions rate (PER).

This blog post summarizes what the Notice covers, how the PER process fits within the broader 45Z Credit framework, and practical considerations for clean fuel producers and project stakeholders. For a broader overview of recent 45Z developments, including Notice 2026-53 and the September 2026 update to the 45ZCF-GREET model, please refer to this Latham blog post and Client Alert.

Background

The 45Z Credit was established under the Inflation Reduction Act of 2022 and amended by the One Big Beautiful Bill Act (OBBBA) (Public Law 119-21). The credit amount depends in part on the lifecycle greenhouse gas emissions rate of the transportation fuel. The 45Z Credit is calculated as the applicable amount per gallon (or gallon equivalent) multiplied by an emissions factor that measures the fuel’s lifecycle emissions relative to a 50 kilogram of carbon dioxide equivalent per million British thermal unit (kg CO2e/mmBTU) baseline.

Transportation fuel producers seeking the credit must determine their fuel’s emissions rate in one of two ways:

  • Emissions rate table: Producers can use the applicable emissions rate table published for Section 45Z. The IRS issued the initial table in Notice 2025-11 on January 10, 2025, and an updated table for calendar year 2026 in Notice 2026-53 on September 8, 2026.
  • Provisional emissions rate: Producers can petition the Secretary of the Treasury for a PER if the fuel’s type, primary feedstock, or pathway is not included in the applicable emissions rate table.

What the Notice Covers

The Notice marks the end of a multi-year rollout:

  • January 2025: The IRS issued Notice 2025-10. Notice 2025-10 provided that an applicant seeking a PER must follow the latest procedures for obtaining a PER as published by the Secretary Treasury in the Section 45Z regulations and in the Internal Revenue Bulletin, including the process for obtaining an emissions value from DOE.
  • July 24, 2025: DOE published a notice of intent and request for comment on the proposed Emissions Value Request Process (90 FR 34855), which is similar to the process for claiming the Section 45V Clean Hydrogen Production Tax Credit (89 FR 80898), which was made available on October 1, 2024, and contemplates that the taxpayer would complete a front-end engineering and design (FEED) study or similar prior to requesting an emissions value from DOE.
  • February 4, 2026: Treasury and the IRS published proposed regulations setting out the procedures that a taxpayer must follow to request a PER determination (91 FR 5160, 5173).
  • October 16, 2026: DOE announced the opening of the 45Z Emissions Value Request Process.

In practice, the PER process has two stages. First, the producer obtains an emissions value from DOE through the Emissions Value Request Process. Second, the producer uses that value to petition Treasury for a PER determination.

Under proposed § 1.45Z-2(f), the PER process is available for “eligible fuels” that are not included in the applicable emissions rate table or that are included in the emissions rate table but their applicable process category (i.e., primary feedstock and pathway) is not. DOE and the IRS will deny any request for a fuel type and category already covered by the table, or any request based on a facility rather than a type or category of fuel.

Taxpayers must first submit an emissions value request (EVR) to DOE in accordance with DOE’s Emissions Value Request Process. The EVR must include specific sections of a Class 3 FEED study (or similar indication of project maturity, as determined by DOE) for each facility producing the fuel, along with a completed Section 45Z EVR Form. Applicants are not required to generate a new Class 3 FEED study for applications involving modifications to existing production lines or use of novel feedstock on such lines.

DOE evaluates the EVR using the same well-to-wheel system boundary and fixed background data as the 45ZCF-GREET model and, upon completing its review, issues a calculated emissions value letter (CEVL) to the taxpayer. The taxpayer then files the CEVL as its PER petition with IRS Form 7218 on its timely filed return for the first taxable year in which it claims the 45Z Credit for that fuel.

A properly filed petition is deemed accepted by the IRS. The taxpayer may rely on the emissions value provided in the CEVL for purposes of calculating the Section 45Z credit so long as the information provided to DOE is accurate, and the resulting rate relates back to January 1, 2025. If a later emissions rate table covers the fuel, the taxpayer must use the applicable emissions rate table instead and can no longer rely on the CEVL for the fuel.

Key Considerations for Stakeholders

  • Scope: The Notice is most relevant to producers of fuels with a type, primary feedstock, or pathway not covered by the 2026 emissions rate table. Project developers, investors, lenders, and credit purchasers evaluating those projects should also take note. Without a table rate or a PER, these producers have no means of establishing an emissions rate for 45Z purposes.
  • Prospective table updates: Before starting a request, producers should consider whether DOE and the IRS plan to add their pathway to the table. For example, poultry litter and beef manure pathways are expected in a later 45ZCF-GREET update, and the IRS has encouraged producers using those feedstocks to wait for that update rather than file PER petitions.
  • Evolving procedures: The PER procedures appear in proposed regulations that have not yet been finalized. Producers should expect that the final regulations could refine the petition requirements.
  • Action items: The Notice does not set a filing deadline. Stakeholders should consider:
    • reviewing the request materials on DOE’s website;
    • confirming that the fuel’s type, primary feedstock, or pathway is absent from the applicable emissions rate table; and
    • directing questions to DOE at 45ZEmissionsRequest@doe.gov or (202) 287-5531.

What’s Next

The Notice is an important step toward giving producers of novel or unlisted fuels access to the 45Z Credit. Key developments to watch include finalization of the Section 45Z proposed regulations and further 45ZCF-GREET model updates.

Latham & Watkins will continue to monitor developments in the Section 45Z regulatory framework, including implementation of the Emissions Value Request Process and the PER petition procedures.