The 5th Annual Next Generation Bio-Based and Sustainable Chemicals Summit takes place Tuesday through Friday, February 4-7, 2014, in sunny San Diego, California. The premier biobased and sustainable chemicals information and networking event for biobased start-ups, global chemical majors, brand owners, feedstock providers, venture capitalists, and academics will feature a Keynote address by Kaj Johnson, Green Chef and Senior Director of Product Development from Method, who will speak about Sustainability by Design, and nine Real-World Case Studies from Novomer, Genomatica, POET, PSA Peugeot Citroën, Succinity GmbH, RSC Bio Solutions and Waste Pro USA, Novasep, and ENVIRON and Sigma-Aldrich will be provided.
Tuesday's pre-conference program is a strategic business forum dedicated to "Policy, Economics, Investment and Global Partnering to Support the Growth of Bio-Based Industry." Sessions will cover critical business issues for biobased products, including obtaining capital, developing global partnerships, and a presentation on the "Regulatory Opportunities and Challenges on the Road to Commercialization" by Lynn L. Bergeson.
Wednesday's pre-conference forum is titled "Moving Bio-Based Chemicals Beyond Technology: Fitting Bio-Based Materials into the Larger Picture of Global Sustainability" and will feature case studies and panel discussions, including "The Commercialization and Adoption of Readily Biodegradable, Biobased Functional Fluids and Cleaners" and "NGO Perspective for Evaluating Bio-Based Materials & Importance of their Role in the Industry."
The main summit gets underway Thursday with a keynote panel discussion, "Spurring Market Adoption -- Brand Owner and Chemical Major Perspectives," moderated by summit chair and Executive Director of Biobased and Renewable Products Advocacy Group (BRAG™) Kathleen M. Roberts. Over the two-day program, attendees will learn from a myriad of the leading business innovators in biobased and renewable chemicals, including Sherwin-Williams, International Paper, IBM, Myriant, Beta Renewables, Virdia, ARPA-E, Avantium, Elevance, Bioamber, Metabolix, DSM, Seventh Generation, and more.
Intuitively, entities in the "biobased" space may think the "naturally occurring" substance exemption under the Toxic Substances Control Act (TSCA), the law that governs chemical products in the U.S., applies to their "biobased" materials. The scope of the exemption is limited, however, and complications arise when companies mistakenly assume a material is naturally occurring and therefore exempt from TSCA.
Learn more about this important issue online.
As the new year begins, there are several predictions on the path for reform of TSCA. The vehicle for reform is expected to be S. 1009, the Chemical Safety Improvement Act (CSIA), bi-partisan legislation introduced last year by Senator David Vitter (R-LA), Ranking Member of the Senate Committee on Environment and Public Works (EPW), and the late Senator Frank Lautenberg (D-NJ). Senator Vitter and Senator Tom Udall (D-NM) are now working to move CSIA forward through the legislative process. A Law360 article recently published by Lynn Bergeson contains a detailed discussion of the significance and provisions of this legislation. With 25 bipartisan co-sponsors, CSIA is a "potentially politically viable framework for TSCA reform and renewed hope that badly needed modernization of this ancient law may occur."
Recently, Senator Vitter stated publicly that he expects to be able to move CSIA through the Senate toward passage this year. That task will face challenges. CSIA, or any TSCA reform legislation, will need to first pass the Senate EPW Committee. Its Chair, Senator Barbara Boxer (D-CA), is seeking amendments to limit CSIA's preemptive effect with respect to tougher state chemical laws like California's Proposition 65 and the Safer Consumer Products Regulations.
Several incentives designed to encourage renewable energy development and production, including the $1 per gallon tax credit for biodiesel producers and the $1.01 per gallon credit for cellulosic ethanol production, expired on December 31, 2013. Should extenders be considered, it is likely these two credits will be extended and likely retroactively. Although given election year politics and ongoing budget battles, if and when this happens is tougher to predict. In the short term, one legislative vehicle could be legislation to increase the debt limit expected to pass later this winter or early spring. Some argue Congress may not consider any tax extender package until later this year after the November elections.
The biofuels industry is working hard to press Congress quickly to take up and pass a tax extender package. The biodiesel and cellulosic producer tax credits are considered essential parts of the suite of current policies designed to promote the industry.
On December 18, 2013, President Obama announced that he will nominate Senator Max Baucus (D-MT) to be the next Ambassador to China. The nomination is expected to pass quickly and without much opposition. Senator Baucus serves as the Chair of the Senate Committee on Finance, the tax writing Committee. When he leaves the Senate, current Senate Committee on Energy and Natural Resources Chair Ron Wyden (D-OR) is expected to assume the chairmanship.
These moves will impact the fate of incentives for the biofuels and renewable chemicals and products industries, including whether and when the Senate considers a tax extenders package, or tax reform, among other tax policies impacting the industry.
On December 19, 2013, President Obama announced his intent to nominate Janet McCabe to lead the U.S. Environmental Protection Agency's (EPA) Office of Air and Radiation. She has been serving as Acting Assistant Administrator of the Air and Radiation Office since July when Gina McCarthy left to become EPA Administrator. McCabe is generally well-liked and respected, and she is expected to be confirmed without much opposition. McCabe is expected to face tough questions during her nomination hearing on several policies, including EPA efforts to reduce greenhouse gas emissions.
President Obama will need to re-nominate his choices to fill key positions at EPA and other agencies because of unsuccessful attempts to allow pending nominations -- including several that have already cleared the Senate EPW Committee -- to carry over to this year. Nominees affected include Ken Kopocis, who had been nominated to serve as EPA Assistant Administrator of Water.
There have been several efforts in the last few weeks to convince the Obama Administration to reconsider its proposal to reduce the 2014 Renewable Fuel Standard (RFS) statutory renewable volume obligations (RVO) for advanced and total renewable (corn ethanol) biofuels, and to maintain in 2014 and 2015 the status quo for biodiesel. Senators David Vitter (R-LA) and Benjamin Cardin (D-MD) are expected to introduce a bill in the coming weeks, which would amend the RFS and reduce its corn ethanol targets.
On December 18, a group of 16 Senators met with EPA Administrator Gina McCarthy to urge EPA to maintain the statutory 2014 RFS RVOs for advanced and total renewable fuels. They argued that the proposed reductions are unnecessary given expected production and that they would harm their respective state economies and the energy diversity and security of the United States. On the same day, Senator Heidi Heitkamp (D-ND), who had attended the meeting, sent a letter to Administrator McCarthy expressing her concerns about EPA's RFS proposed rule. A copy of the letter is available online.
Also on December 18, 2013, 54 Members of the House of Representatives from 24 states sent a letter to the leaders of the EPA, U.S. Department of Agriculture (USDA), and Office of Management and Budget urging that the RFS final rule increase the required volumes of biodiesel. A copy of the letter is available online.
On December 20, 2013, the Governors of six Midwestern states sent a letter to President Obama expressing their concerns about the RFS proposed rule. They also urged the Administration to maintain the statutory RFS RVOs for total renewable fuel and raise the biodiesel requirements for 2014 and 2015. A copy of the letter is available online.
LignoTech Developments Ltd. subsidiary Xylemer BioProducts of New Zealand will soon open a new facility in Kearney, Nebraska. The facility will produce biomass-based resins. Distillers grains will be the first feedstocks used, likely followed by sugar beet pulp and rice hulls.
On December 19, 2013, Cortec Corporation headquartered in St. Paul, Minnesota, announced its Patent Pending BioPad® product. The company states that BioPad® "is a unique flexible corrosion inhibiting device constructed from 100% biobased non-woven material, containing 66% biobased content. BioPad® provides an eco-friendly sustainable packaging option for corrosion inhibition and has been awarded USDA BioPreferredSM designation. It is specially designed with Vapor phase Corrosion Inhibitors (VpCI®) impregnated throughout the substrate." A copy of Cortec's press release is available online.
On December 31, 2013, Ironridge Global Partners, LLC, an institutional investor based in Los Angeles, California, announced that it has launched a green initiative designed to fund sustainable businesses, including emerging growth companies focused on environmental sustainability and environmentally-friendly products and services. As part of the initiative, Ironridge has provided over $6 million to Cereplast, Inc., a leading manufacturer of proprietary biobased, compostable and sustainable bioplastics, and its creditors. A copy of the press release is available online.
On December 23, 2013, the U.S. Department of Energy (DOE) announced that it was ending its funding of BlueFire Renewable's cellulosic production facility project in Fulton, Mississippi. DOE took this action because the company reportedly failed to meet deadlines related to financing the project. This news comes as the cellulosic industry continues to be under attack for failing to live up to expectations under the federal RFS.
Just before adjourning for its winter recess, the U.S. House of Representatives approved on December 13, 2013, by voice vote an extension of the 2008 Farm Bill through January 31, 2014. The vote is considered symbolic because Senate Majority Leader Harry Reid (D-NV) has asserted that the Senate will not consider an extension. Senator Debbie Stabenow (D-MI) and Representative Colin Peterson (D-MN), two of the principals leading Farm Bill negotiations, have reportedly stated that an extension is unnecessary since they expect to prepare in final a framework for the next Farm Bill to be passed by Congress before the end of January. Although the U.S. Department of Agriculture will be required, absent a new Farm Bill, to set up a supply-side management program after December 31, 2013, it is expected that Congress will pass a new five-year Farm Bill by the end of January 2014, when such a program would effectively be up and running.
It has been reported that the U.S. House of Representatives Energy and Commerce Committee's Subcommittee on Energy and Power Chair John Shimkus (R-IL) has listed reform of the 1976 Toxic Substances Control Act (TSCA) among his top priorities for 2014. Chair Shimkus has stated publicly that the House is still determining how best to draft and move TSCA reform legislation, but he expects a House TSCA reform bill to be introduced by the spring, with action on it likely next summer.
Chair Shimkus reportedly has also indicated that he expects no action on the Renewable Fuel Standard (RFS) in the House before the U.S. Environmental Protection Agency (EPA) promulgates its 2014 RFS rule. The oil and gas industry has been advocating for legislative action to repeal the RFS in spite of EPA's proposed 2014 RFS rule that would reduce required volume obligations for cellulosic biofuels, as well as advanced biofuels and corn ethanol. The biofuels industry has argued that no legislative action is needed given EPA's regulatory flexibility to modify gallon requirements as needed under the law.
On December 12, 2013, Representative Scott Peters (D-CA), Chair of the House Algae Caucus, introduced H.R. 3758, a bill to extend the $1.01/gallon second generation biofuel producer credit and the special allowance for second generation biofuel plant property. These incentives are among several currently set to expire at the end of the year.
Members of the House and Senate have sent letters to the Chairs and Ranking Members of their respective tax writing Committees -- the House Ways and Means Committee and the Senate Finance Committee -- urging the extension of ten clean energy incentives as soon as possible. Biofuels and biodiesel incentives are among those identified in the letter as important to extend until any broader tax reform legislation is passed.
The House is currently out on its winter break and will not return until January. There are promising signs that the House and Senate will work to pass retroactive extensions of incentives for the biofuels industry when they resume legislative business early next year.
Currently, there are two nearly identical proposals before Congress to provide a business related tax credit for the production of renewable chemicals. S. 1267, the Qualifying Renewable Chemical Tax Production Act of 2013, was introduced on June 27, 2013, by Senator Debbie Stabenow (D-MI). The bill has one co-sponsor, Senator Al Franken (D-MN). H.R. 3084, a bill by the same name, was introduced on September 12, 2013. It currently has five bi-partisan co-sponsors, including Representatives Richard Neal (D-MA), Scott Peters (D-CA), Linda Sanchez (D-CA), Allyson Schwartz (D-PA), and Steve Stockman (R-TX). A copy of S. 1267 is available online. A copy of H.R. 3084 is available online.