I 
116TH CONGRESS 
2D SESSION 
H. R. 8879 
To amend the Internal Revenue Code of 1986 to provide credits for the 
production of renewable chemicals and investments in renewable chemical 
production facilities, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
DECEMBER 4, 2020 
Mr. PASCRELL (for himself and Mr. FITZPATRICK) introduced the following 
bill; which was referred to the Committee on Ways and Means 
A BILL 
To amend the Internal Revenue Code of 1986 to provide 
credits for the production of renewable chemicals and 
investments in renewable chemical production facilities, 
and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Renewable Chemicals 
Act of 2020’’. 
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SEC. 2. CREDITS FOR PRODUCTION OF RENEWABLE CHEMI-
CALS AND INVESTMENTS IN RENEWABLE 
CHEMICAL PRODUCTION FACILITIES. 
(a) PRODUCTION OF RENEWABLE CHEMICALS.— 
(1) IN GENERAL.—Subpart D of part IV of 
subchapter A of chapter 1 of the Internal Revenue 
Code of 1986 is amended by adding at the end the 
following new section: 
‘‘SEC. 45U. CREDIT FOR PRODUCTION OF RENEWABLE 
CHEMICALS. 
‘‘(a) IN GENERAL.—For purposes of section 38, the 
production credit for renewable chemicals for any taxable 
year is an amount (determined separately for each renew-
able chemical) equal to— 
‘‘(1) 15 percent of the sales price of each pound 
of a renewable chemical— 
‘‘(A) produced— 
‘‘(i) by the taxpayer, or 
‘‘(ii) for the taxpayer by a contract 
manufacturer under a binding written 
agreement, and 
‘‘(B) sold for its fair market value at retail 
by the taxpayer during the taxable year, re-
duced by 
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‘‘(2) a percentage equal to so much of the per-
centage of the renewable chemical as is not biobased 
content. 
‘‘(b) LIMITATION.—The amount of the credit deter-
mined under subsection (a) with respect to a renewable 
chemical sold during any taxable year shall not exceed the 
credit amount allocated for purposes of this section by the 
Secretary to the taxpayer with respect to such chemical 
for such taxable year under section 48E. 
‘‘(c) DEFINITIONS.—For purposes of this section— 
‘‘(1) RENEWABLE
CHEMICAL.—The term ‘re-
newable chemical’ means any chemical which— 
‘‘(A) is produced in the United States (or 
in a territory or possession of the United 
States) from renewable biomass, 
‘‘(B) is not less than 95 percent biobased 
content, 
‘‘(C) is not sold or used for the production 
of any food, feed, fuel, or pharmaceuticals, 
‘‘(D) is approved to use the USDA Cer-
tified Biobased Product label under section 
9002(b) of the Farm Security and Rural In-
vestment Act of 2002 (7 U.S.C. 8102(b)), and 
‘‘(E) is a chemical intermediate (as such 
term is defined in section 3201.109 of title 7, 
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Code of Federal Regulations (or successor regu-
lations)). 
‘‘(2) BIOBASED CONTENT.—The term ‘biobased 
content’ means, with respect to any renewable chem-
ical, the biobased content of the total mass of or-
ganic carbon in such chemical (expressed as a per-
centage), determined by testing representative sam-
ples using the American Society for Testing and Ma-
terials (ASTM) D6866. 
‘‘(3) RENEWABLE BIOMASS.—The term ‘renew-
able biomass’ has the meaning given such term in 
section 9001(13) of the Farm Security and Rural 
Investment Act of 2002 (7 U.S.C. 8101(13)). 
‘‘(d) NATIONAL LIMITATION ON CREDITS FOR RE-
NEWABLE CHEMICALS.—See section 48E(e) for rules re-
lating to national limitation on credits under this section. 
‘‘(e) COORDINATION WITH INVESTMENT CREDIT FOR 
RENEWABLE CHEMICAL PRODUCTION FACILITIES.—See 
section 48E(f) for rules coordinating section 48E with this 
section. 
‘‘(f) TERMINATION.—Notwithstanding any other pro-
vision of this section or section 48E, the Secretary may 
not allocate any credit amount under this section to any 
taxable year which begins more than 5 years after the date 
of the enactment of this section.’’. 
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(2) CREDIT TO BE PART OF GENERAL BUSI-
NESS CREDIT.—Subsection (b) of section 38 of such 
Code is amended by striking ‘‘plus’’ at the end of 
paragraph (32), by striking the period at the end of 
paragraph (33) and inserting ‘‘, plus’’, and by add-
ing at the end the following new paragraph: 
‘‘(34) the renewable chemicals production credit 
determined under section 45U(a).’’. 
(b) INVESTMENT CREDIT IN LIEU OF PRODUCTION 
CREDIT.— 
(1) IN GENERAL.—Section 46 of the Internal 
Revenue Code of 1986 is amended by striking ‘‘and’’ 
at the end of paragraph (5), by striking the period 
at the end of paragraph (6) and inserting ‘‘, and’’, 
and by adding at the end the following new para-
graph: 
‘‘(7) the renewable chemical production facili-
ties credit.’’. 
(2) RENEWABLE
CHEMICAL
PRODUCTION
FA-
CILITIES CREDIT.—Subpart E of part IV of sub-
chapter A of chapter 1 of such Code is amended by 
inserting after section 48D the following: 
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‘‘SEC. 48E. INVESTMENT CREDIT FOR RENEWABLE CHEM-
ICAL PRODUCTION FACILITIES. 
‘‘(a) IN GENERAL.—For purposes of section 46, the 
renewable chemical production facilities credit for any tax-
able year is an amount equal to 30 percent of the basis 
of any eligible property which is a part of a renewable 
chemical production facility placed in service by the tax-
payer during such taxable year. 
‘‘(b) LIMITATION.—The amount of the credit deter-
mined under subsection (a) with respect to a renewable 
chemical production facility of the taxpayer during any 
taxable year shall not exceed the credit amount allocated 
for purposes of this section by the Secretary to the tax-
payer for such taxable year under subsection (e). 
‘‘(c) RENEWABLE CHEMICAL PRODUCTION FACIL-
ITY.—For purposes of this section— 
‘‘(1) IN GENERAL.—The term ‘renewable chem-
ical production facility’ means a facility— 
‘‘(A) which is owned by the taxpayer, 
‘‘(B) which is originally placed in service 
after the date of the enactment of this section 
and before the first day of the taxable year 
which begins 6 years after the date of the en-
actment of this section, 
‘‘(C) with respect to which— 
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