Kentucky grows green chemicals

By Blake Jackson

Kentucky is offering a renewed opportunity for companies to participate in its Renewable Chemical Production Program. This initiative incentivizes the creation of specified chemicals derived from sustainable biomass feedstocks, helping the state's economy and environment.

Eligible companies can earn tax credits based on capital investment, job creation, and production of qualified renewable chemicals. These credits, previously allocated to renewable diesel, now support this broader range of eco-friendly products.

The program prioritizes chemicals with at least 50% biobased content, excluding those used for food, feed, or fuel. Companies interested in learning more about eligibility, job creation requirements, and capital investment thresholds can refer to regulation 302 KAR 4:010.

The Kentucky Department of Agriculture, in collaboration with the Department of Revenue, will manage the program and award tax credits. To qualify, businesses must:

• Be physically located and operating for profit in Kentucky.
• Have expanded, organized, or established operations in the state after July 1, 2020.
• Create and retain new jobs for four years or invest significantly in new capital, also maintained for four years.
• Exclude professional services, healthcare, medical treatments, and retail operations. Expansion should not involve relocating or reducing operations from other Kentucky locations.

By offering these incentives, Kentucky aims to leverage its resources and infrastructure while fostering the growth of a sustainable chemical manufacturing industry.

To find out more about Kentucky’s Renewable Chemical Production Program or to request an application, contact the Kentucky Department of Agriculture at ag.web@ky.gov.

Complete applications along with the required $500 compliance fee must be filed with the Kentucky Department of Agriculture by Jan. 15, 2024.

Photo Credit: istock-sasapanchenko