On March 2, 2017, Congressmen Adrian Smith (R-NE) and Congressman Dave Loebsack (D-IA) reintroduced legislation to expand the current Reid Vapor Pressure (RVP) waiver to include E15 motor vehicle fuel. The Consumer and Fuel Retailer Choice Act aims to foster the development of a robust energy marketplace by offering the same regulatory relief that has been extended to E10. Under the Clean Air Act (CAA), the U.S. Environmental Protection Agency (EPA) is required to control the volatility of gasoline between June 1 and September 15 to limit vehicle emissions. Congress permitted a RVP waiver for E10 due to its reduced emissions. EPA, however, has continuously refused to extend the waiver to E15 despite its lower volatility compared to E10. The bipartisan legislation would remove the restriction on the sale of E15 during the summer months and allow the fuel to be sold year-round.
On March 2, 2017, Congressman Bob Goodlatte (R-VA) reintroduced the Renewable Fuel Standard (RFS) Reform Act, which aims to guide the debate and reform of the ethanol mandate. According to Goodlatte, the RFS program failed to lower prices at the pump and resulted in unintended and profound effects on consumers, energy producers, livestock producers, retailers, and the environment. The RFS Reform Act, which had 42 bipartisan cosponsors, would eliminate corn-based ethanol requirements, place a ten percent cap on the amount of ethanol that can be blended into conventional gasoline, require EPA to set cellulosic biofuels targets at levels produced by the industry, and decrease the total volume of renewable fuel content in gasoline sold or introduced into commerce from 2017 through 2022.
On March 7, 2017, the Governors’ Biofuels Coalition sent a letter to President Trump requesting the Administration’s support for changes to various federal policies to strengthen biofuels production and expand markets for ethanol and other biofuels. The letter, which was signed by Nebraska Governor Pete Ricketts and Iowa Governor Terry Branstad, specifically highlights the need for the Trump Administration to change the fuel volatility limitations placed on E15, to update corn ethanol’s lifecycle carbon emissions profile to reflect advances in ethanol production technology, and to update the 2014 motor vehicle emission simulator model to prohibit spurious comparisons of high- and low-ethanol emissions factors. The governors commended Trump on his support of the biofuels industry over the past year and stated that expanding biofuels production is one of the best ways to meet the nation’s energy needs.
On March 9, 2017, Neste, a member of the Biobased and Renewable Products Advocacy Group (BRAG®), announced that its My Renewable Diesel helped reduce greenhouse gas (GHG) emissions by 6.7 million tons in 2016. The reduction of carbon emissions from MY Renewable Diesel is equivalent to the removal of 2.4 million passenger cars from the road for one full year. The low-carbon diesel, which is refined from renewable raw materials, is suitable for all diesel-powered passenger cars and heavy transport vehicles, including buses, garbage trucks, and emergency vehicles, without the need for vehicle-related investments or modifications. Neste aims to increase the total annual GHG emission reduction volume to seven million tons in 2017.
By Lynn L. Bergeson and Margaret R. Graham
On March 9, 2017, the National Academies of Sciences, Engineering, and Medicine (NAS) announced the release (pre-publication version) of a new report: Preparing for Future Products of Biotechnology. Pursuant to the White House Office of Science and Technology Policy's (OSTP) July 2, 2015, memorandum, “Modernizing the Regulatory System for Biotechnology Products,” NAS was tasked with looking into the future and describing the possible future products of biotechnology that will arise over the next five to ten years, as well as providing some insights that can help shape the capabilities within the agencies as they move forward. More information regarding the July 2015 memorandum is available on our website under the key phrase Biobased Products, Biotechnology.
Via an ad hoc committee, the Committee on Future Biotechnology Products and Opportunities to Enhance Capabilities of the Biotechnology Regulatory System, NAS developed this report through several months of gathering and synthesizing information from several sources, including: 74 speakers over the course of three in-person meetings and eight webinars, including one presented by Lynn L. Bergeson; responses to its request for information from a dozen federal agencies; statements solicited from members of the public at its in-person meetings; written comments through the duration of the study; and recent NAS studies related to future products of biotechnology.
The report presents conclusions concerning the future biotechnology products themselves, as well the challenges that federal agencies will face in regulating them, which include:
- The bioeconomy is growing rapidly and the U.S. regulatory system needs to provide a balanced approach for consideration of the many competing interests in the face of this expansion;
- The profusion of biotechnology products over the next five to ten years has the potential to overwhelm the U.S. regulatory system, which may be exacerbated by a disconnect between research in regulatory science and expected uses of future biotechnology products;
- Regulators will face difficult challenges as they grapple with a broad array of new types of bio-technology products -- for example, cosmetics, toys, pets, and office supplies -- that go beyond contained industrial uses and traditional environmental release;
- The safe use of new biotechnology products requires rigorous, predictable, and transparent risk-analysis processes whose comprehensiveness, depth, and throughput mirror the scope, scale, complexity, and tempo of future biotechnology applications.
The report provides three recommendations for federal agencies in responding to these challenges, which it states should be taken to “enhance the ability of the biotechnology regulatory system to oversee the consumer safety and environmental protection required for future biotechnology products”:
- The U.S. Environmental Protection Agency (EPA), the U.S. Food and Drug Administration (FDA), the U.S. Department of Agriculture (USDA), and other agencies involved in regulation of future bio-technology products should increase scientific capabilities, tools, expertise, and horizon scanning in key areas of expected growth of biotechnology, including natural, regulatory, and social sciences.
- EPA, FDA, and USDA should increase their use of pilot projects to advance understanding and use of ecological risk assessments and benefit analyses for future biotechnology products that are unfamiliar and complex and to prototype new approaches for iterative risk analyses that incorporate external peer review and public participation.
- The National Science Foundation, the Department of Defense, the Department of Energy, the National Institute of Standards and Technology, and other agencies that fund bio-technology research with the potential to lead to new biotechnology products should increase their investments in regulatory science and link research and education activities to regulatory-science activities.
The report is well-written and contains an impressive amount of new, relevant, and important information. The Committee participants are to be commended for an important new piece of scholarship in this area.
The report’s conclusions are also significant, but not entirely unexpected. For those of us working in this space, we have recognized for years the lack of clarity regarding jurisdictional boundaries, the paucity of government resources, and the urgent need for regulatory clarity and significantly enhanced funding. Unfortunately, given current Trump Administration efforts to diminish government funding for EPA, FDA, and elsewhere, the well-crafted and spot-on recommendations may tragically fall on deaf ears. Shareholders should carefully review the report and work hard to ensure the recommendations are implemented. The consequences of failing to “increase scientific capabilities, tools, expertise, and horizon scanning in key areas of expected growth of biotechnology, including natural regulatory, and social sciences” -- the number one recommendation in the report -- are too great to ignore.
On February 27, 2017, the U.S. Department of Energy’s (DOE) Bioenergy Technologies Office (BETO) announced the publication of the Biorefinery Optimization Workshop Summary Report. The report provides an overview of the discussion on industry challenges and opportunities that took place during the October 2016 Biorefinery Optimization Workshop in Chicago, Illinois. The workshop, which comprised a combination of presentations and breakout sessions, focused on feedstock and materials handling; process scale-up, intensification, and cost reduction; and co-product and waste stream monetization. Discussions from the breakout sessions include key findings on best practices, lessons learned, challenges, potential solutions, and resources needed to overcome current challenges.
On February 22, 2016, the Renewable Fuels Association (RFA) published the results of a study on the impact of the ethanol industry on the U.S. economy. The study, which was commissioned by ABF Economics, found that the U.S. ethanol industry contributed over $42 billion to the nation’s gross domestic product (GDP) and supported 340,000 jobs in 2016. Additionally, the report states that the ethanol industry provided significant contributions in terms of displacing imported crude oil and petroleum products, and generating tax revenue.
According to the report, the U.S. produced 15.2 billion gallons of ethanol in 2016, which resulted in:
||Nearly $14.5 billion to the U.S. economy from manufacturing;
||More than $22.5 billion in income for American households;
||An estimated $4.9 billion in federal tax revenue and $3.6 billion in revenue to state and local governments; and
||The displacement of 510 million barrels of imported oil.
On March 2, 2017, Kathleen M. Roberts, Executive Director of the Biobased and Renewable Products Advocacy Group (BRAG®), participated as a panelist alongside four other trade associations in the “Domestic Policy Forum” at the 2017 Advanced Bioeconomy Leadership Conference (ABLC2017). Ms. Roberts discussed the challenges facing the bioeconomy, including the implementation of the amendments to the Toxic Substances Control Act (TSCA), issues with the TSCA nomenclature system, and the potential for increased scrutiny of renewable products under the current Administration, as well as the work being done by BRAG to address these challenges and to level the playing field for biobased chemicals. If companies wish to ensure equitable regulations for biobased chemicals and products, they should consider joining BRAG to assist with future engagement with EPA.