U.S. Senators Tom Daschle (D-SD) and Richard Lugar (R-IN) have introduced legislation to establish a Renewable Fuel Standard (RFS). The bill mirrors provisions passed by the Senate last year in the comprehensive energy package. It would establish a renewable fuel standard of 5 billion gallons by 2012. While the legislation is largely aimed at growing the ethanol market, requirements of the RFS can be met by using biodiesel.

In addition, several legislative measures designed to encourage use of biodiesel have been introduced. They include such areas as reduction in excise taxes and changes in air-quality regulations.