By Lauren M. Graham, Ph.D.
On August 1, 2017, the U.S. Environmental Protection Agency (EPA) held a public hearing to hear from all segments of the fuel industry on the proposed rule to set the 2018 renewable volume obligations (RVO) under the Renewable Fuel Standard (RFS) program. Among the nearly 150 individuals and organizations scheduled to testify at the hearing were numerous biofuel industry stakeholders who praised EPA for issuing the proposed rule on time and for maintaining the statutory 15 billion gallon volume requirement for conventional renewable fuels, but urged the agency to increase the proposed requirements for advanced and cellulosic fuels.
During its testimony, the Renewable Fuels Association (RFA) stated that it believes that EPA “erred on the side of pessimism with regard to the potential for significant growth in cellulosic ethanol commercialization.” According to Bob Dinneen, Chief Executive Officer (CEO) of the RFA, many plants are in the process of adding bolt-on fiber conversion technology to their existing facilities, which could dramatically increase cellulosic ethanol production next year. RFA intends to provide EPA with updated projections for cellulosic fuel before the comment period ends. Dinneen also highlighted concerns with Renewable Identification Number (RIN) market manipulation and suggested that EPA continue to allow imported biofuels to help comply with the RFS program.
With a group of approximately 20 speakers, the National Biodiesel Board (NBB) highlighted key data and information regarding market realities and underutilized capacity, and the impacts on small businesses and manufacturing, feedstock availability, and consumer choice. Donnell Rehagen, NBB CEO, stated that the “current numbers shortchange the progress we have made. They are a step back for the RFS, job creation, small businesses and rural economies.” Rehagen clarified that “these steps backwards are not about paper but people.”
The Renewable Energy Group (REG) informed EPA that ample feedstocks, technology and quality advances, and subsidized imported biofuel are three reasons why the agency should increase the biomass-based diesel and advanced biofuel minimum volumes. Derek Winkel, Executive Director of Manufacturing, stated that “investments [into the biofuel sector] would not have been made without increasing demand for biodiesel and renewable diesel. This demand, in part, is supported by a strong, growing and consistent RVO and RFS.” Paul Nees, Executive Director of REG’s Operations Control Team, testified that “[t]he domestic biodiesel industry is ready and able to fulfill demand gaps with low-cost, high-quality fuel with no market disruption.”
During its testimony, the Iowa Renewable Fuels Association (IRFA) suggested that the recent verdict in Americans for Clean Energy v. EPA should radically alter the factors EPA considers when determining RFS levels this year and going forward. “The Court clearly affirmed that Congress’ intent for the RFS from the very beginning was to crack the petroleum monopoly and to push biofuels into the marketplace,” stated Monte Shaw, IRFA Executive Director. “Whether in a reset discussion or in setting biodiesel and ethanol levels, the EPA must act according to the clear directive from the Court.”
The American Coalition for Ethanol's (ACE) testimony highlighted its view on conventional biofuel levels, the general waiver authority as it relates to inadequate domestic supply, the use of the reset provisions, and updating the greenhouse gas modeling for corn ethanol as it relates to Brazilian sugarcane ethanol. The Coalition intends to detail its position on these topics in written comments. Jonathon Lehman, ACE legislative counsel, also praised Nebraska Governor Pete Ricketts and Iowa Governor Kim Reynolds for their strong public support for keeping the RFS on track.
Stakeholders representing the oil industry were also present to testify to the problems they see with the RFS program, including the representatives from the American Petroleum Institute (API), the American Fuel and Petrochemical Manufacturers (AFPM), and Valero.
Written statements and supporting information concerning the proposed rule are available under Docket ID No. EPA-HQ-OAR-2017-0091. As stated in the Federal Register notice, EPA will consider the written comments with the same weight as any oral comments presented at the public hearing.
On June 9, 2017, the U.S. Environmental Protection Agency (EPA) announced the winners of the 2017 Green Chemistry Challenge Award (GCCA). We applaud this year’s winners. This is EPA’s 22nd year of using the GCCA to honor green chemistry technologies that spur economic growth, reduce costs, and decrease waste. We are saddened that this very successful voluntary program is slated to be defunded in the President's Fiscal Year (FY) 2018 budget, which, of course, must be approved by Congress and is unlikely to be in its current form. Those who value the green chemistry program may wish to consider contacting their Senators and Representatives to encourage continued support of this highly successful and important program. It has had outsized benefits for such a modestly funded program.
This year's winners and technologies are:
- Merck & Co., Inc. in Greener Synthetic Pathways - Letermovir: A Case Study in State-of-the-Art Approaches to Sustainable Commercial Manufacturing Processes in the Pharmaceutical Industry
Merck’s approach was to design an efficient synthesis as early as possible in the drug Letermovir’s process development. Using “high-throughput” techniques, Merck was able to find a low-cost, stable, and easily recyclable catalyst along with other process improvements that increase the yield, and reduce the raw material costs by 93 percent, the water usage by 90 percent, and the carbon footprint by 89 percent.
- Amgen Inc. and Bachem in Greener Reaction Conditions - Green Process for Commercial Manufacture of Etelcalcetide Enabled by Improved Technology for Solid Phase Peptide Synthesis
Amgen Inc. worked with Bachem to improve the manufacturing process for the active ingredient in ParsabivTM, a drug that treats secondary hyperparathyroidism in adult patients with chronic kidney disease. By redesigning the peptide manufacturing process to use four optimized stages rather than the original five stages, Amgen and Bachem were able to achieve a 500 percent increase in manufacturing capacity while reducing chemical solvent use by 71 percent, manufacturing operating time by 56 percent, and manufacturing cost by 76 percent.
- The Dow Chemical Company and Papierfabrik August Koehler SE in Designing Greener Chemicals - Breakthrough Sustainable Imaging Technology for Thermal Paper
While there is still not a definitive answer as to whether the use of bisphenol A (BPA) in thermal paper may present risk, Dow and Koehler sought an innovative alternative that not only avoids the need for BPA (or analogs that have similar toxicological properties), but also eliminates some of the drawbacks of thermal paper, notably that exposure to sunlight or other heat sources often destroys the image. Together they developed a three-layer paper. The top layer is an opaque, light-color.When heat is applied in the printing head, the hollow particles that make up that opaque layer collapse and become transparent, showing an underlying dark layer only at those points. The paper is designed to work in existing equipment, so there is no need for retailers to replace equipment.
- UniEnergy Technologies LLC in Small Business - The UniSystemTM: An Advanced Vanadium Redox Flow Battery for Grid-Scale Energy Storage
UniEnergy Technologies, LLC (UET) and the Pacific Northwest National Laboratory (PNNL) developed and commercialized an advanced vanadium redox flow battery that allows cities and businesses more access to stored energy. The vanadium electrolyte has double the energy density of prior chemistries, and a much broader operating temperature, allowing for a longer lasting battery that can be deployed in nearly any ambient environment on earth. Additionally, the electrolyte, with a chloride-based chemistry complex, is more stable than traditional sulfate-based chemistries, and because it is water-based and does not degrade, the batteries are non-flammable and recyclable.
- Professor Eric J. Schelter of the University of Pennsylvania in Academic - Simple and Efficient Recycling of Rare Earth Elements from Consumer Materials Using Tailored Metal Complexes
Professor Eric Schelter developed a simple, fast, and low-cost technology to help recycle mixtures of rare earth elements (La-Lu, Sc, and Y). These elements are integral to modern technologies, but have a highly energy intensive and waste generating mining, refining, and purification process. Currently, only one percent of these materials are recycled, but Professor Schelter’s group has developed tailored organic compounds that can simply and effectively separate mixtures of these metals. A recent U.S. Department of Energy (DOE) grant will support further development of this technology to turn these into industrial viable recycling processes.
The GCCA winners were honored on June 12, 2017, at a ceremony in Washington, D.C. in conjunction with the 21st Annual Green Chemistry & Engineering Conference.
On January 24, 2017, the Consumer Specialty Products Association (CSPA) sent a letter to President Donald Trump to express its commitment to working with Trump and his administration and to outline its top priorities, including the continuation of EPA’s Safer Choice Program. In the letter, CSPA states that companies have made significant financial and employee investments to develop products that qualify for the Safer Choice logo and to market the products as Safer Choice products. CSPA requested that Trump support the voluntary program, arguing that elimination of it would negate the innovation that resulted from the costly efforts. In addition to continuing the program, the letter suggests that EPA expand the Safer Choice Program to include antimicrobial products that meet the criteria as long as they are not specifically prohibited from using the logo under the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA).
Following the confirmation of Senator Max Baucus as the next Ambassador to China, on February 11, 2014, Senate Democrats voted to shift the leadership and make-up of impacted Committees. Senator Ron Wyden (D-OR) will now be the Chair of the Senate Finance Committee, while Senator Mary Landrieu (D-LA) will take over as Chair of the Senate Energy and Natural Resources Committee. Newly elected Senator Ed Markey (D-MA) will now serve on the Senate EPW Committee.
Senator Landrieu is reportedly working to identify her priorities for the Senate Energy Committee. She is known to be a supporter of the Keystone XL oil pipeline and for increased opportunities for liquefied natural gas exports. The coal industry has stated its public support for Senator Landrieu's new position.
Senator Markey is a longtime champion of environmental issues and will likely add to the momentum to reform TSCA. The Senate version of TSCA reform legislation, S.1009, CSIA, must pass through the Senate EPW Committee before being considered by the full Senate.
On November 15, 2013, U.S. Environmental Protection Agency (EPA) Administrator Gina McCarthy signed the long-awaited and much anticipated Notice of Proposed Rulemaking (NPRM) to set the 2014 renewable volume obligations (RVO) under the federal Renewable Fuel Standard (RFS). Included in the NPRM is a proposal to repeal retroactively the 2011 cellulosic RVOs and refund obligated parties nearly $5 million to recover their costs for trying to meet them. Simultaneously, the Agency issued a pre-publication of its request for comment on several petitions it has received from the American Petroleum Institute (API), American Fuel and Petrochemical Manufacturers (AFPM), and individual obligated parties requesting that EPA grant a partial waiver of the 2014 RFS statutory RVOs. Copies of the pre-published NPRM and the pre-published request for comment notice are available online.
The NPRM appears to be similar to the draft of it that was leaked publicly last month. It marks a shift in EPA's implementation of the RFS, as it proposes to reduce the overall and advanced RVOs, in addition to the cellulosic RVOs. EPA cites blend wall concerns for the proposed overall and advanced reductions. The Agency proposes to maintain the 2013 RVOs for biodiesel in both 2014 and 2015 at a level of 1.28 billion gallons. The cellulosic, advanced, and total renewable RVO gallons contained in the RFS statute for 2014 are: 1.75 billion for cellulosic, 3.75 billion for advanced, and 18.15 billion for total renewable fuel (the RVO for corn starch ethanol is this number minus those for advanced, cellulosic and biodiesel). The proposed RVO gallons for 2014 are: 17 million for cellulosic, 2.2 billion for advanced, and 15.21 billion for total renewable.
Advocates on both sides have ramped up their advocacy since the release of the NPRM. The oil industry continues to call for full repeal of the RFS through the legislative process and the biofuels industry has denounced EPA's shift in RFS implementation, stressing the importance of the stability of the RFS to continue investment in biofuels, especially advanced and cellulosic biofuels. In addition, new groups have formed to add to the debate. A veterans group, VoteVets.org, and Americans United for Change have plans for a media campaign to support ethanol and the RFS. The Bipartisan Policy Center is forming an advisory committee of biofuels stakeholders to develop proposals for RFS reform. Just before the release of the NPRM, a group of 32 Senators, including Patty Murray (D-WA), Al Franken (D-MN), Roy Blunt (R-MO), and Chuck Grassley (R-IA), sent a letter to EPA, calling on the Agency to increase the biodiesel RVO for 2014 instead of holding it at this year's levels as was proposed in the leaked draft 2014 RFS proposed rule (and as is maintained in the official NPRM).
A hearing will be held on December 5, 2013, beginning at 9:00 a.m. at the Hyatt Regency in Crystal City located in Arlington, Virginia. A copy of the notice is available online.
On November 1, 2013, the Biotechnology Industry Organization (BIO), Growth Energy, and RFA filed a motion to intervene on behalf of EPA in the current lawsuit by Monroe Energy, the American Petroleum Institute (API), and the American Fuel and Petrochemical Manufacturers (AFPM) challenging EPA's final rule establishing the 2013 RVOs under the federal RFS. The filing was made in the U.S. Court of Appeals for the District of Columbia Circuit, where the case is pending. Copies of press releases issued by BIO, Growth Energy, and RFA are available online.
On October 30, 2013, the U.S. Court of Appeals for the District of Columbia approved the request by Monroe Energy to expedite review of the current RFS litigation challenging EPA's final rule setting the 2013 renewable volume obligations under the federal RFS (the 2013 RFS rule). In October 2013, Monroe, the American Petroleum Institute (API), and the American Fuel and Petrochemical Manufacturers (AFPM) filed individual cases before the court challenging the 2013 RFS rule. These cases have been consolidated.
In response to Monroe's petition for expedited review, the court issued an order encouraging all parties to work together and propose a mutually agreed upon expedited schedule. The parties, including EPA, submitted a proposed expedited briefing schedule on October 24 and the court approved it on October 30. Under the schedule, all briefs will be submitted by the end of February 2014.
Also on October 24, 2013, the National Biodiesel Board (NBB) filed a petition with the court to intervene in the case on behalf of EPA. NBB asserts that its member companies would be harmed if the 2013 RFS rule were to be changed or weakened.
Biofuels supporters and opponents remain heavily engaged in RFS policy issues. Last week, we reported on a news report that one advanced biofuels trade association, the Advanced Biofuels Association (ABFA), may be working with the American Petroleum Institute (API) on potential legislative language that would provide additional RIN credit for advanced biofuels under the federal RFS program. Since then, ABFA and API have both denied the accuracy of the story. In addition, DuPont announced that it has relinquished its membership in the ABFA and reaffirmed its commitment to advocating that the RFS is working as intended to promote the investment in and development of biofuels and should not be altered in any way through legislation at this point in time.
James C. Greenwood, current President and CEO of the Biotechnology Industry Organization (BIO) and former Member of Congress, sent a letter to the leaders of the House Committee on Energy and Commerce and the Senate Committee on Environment and Public Works asserting that the broad consensus among the biofuels industry, including the advanced biofuels industry, is that now is not the time to legislate on the RFS.
API has continued its opposition to the RFS by announcing that it plans to sue EPA if it fails to issue the final rule setting the 2014 RFS renewable volume obligations (RVO) by November 30, 2013. While the law mandates that EPA issue in final the following year's RVOs by November 30, EPA has consistently missed that deadline. This is the first time API has threatened to sue the Agency if it does not meet the November 30 deadline.
It is being reported that API and the Advanced Biofuels Association (ABFA) are working together on potential legislative language to increase the value of RINs associated with advanced biofuels and to allow them to help make up conventional RINs due to blend wall constraints under the federal RFS. According to news reports, the two groups are working to present this potential language to members of the House Energy and Commerce Committee who are working on developing legislation to modify the RFS.
Several of API's largest members, including Shell and BP, are working on projects to produce advanced biofuels. Reportedly, API and ABFA contend that increasing the value of advanced biofuel RINs and allowing them to help make up conventional RINs due to blend wall constraints would help spur investment in and development of advanced biofuels to help meet the RFS. All other major biofuels trade associations are advocating against any legislative change to the RFS. They argue that, however well-intentioned, opening the RFS up to amendment would make the law vulnerable to repeal, for which the oil industry is heavily lobbying.
In addition, several biofuels groups argue that there are sufficient RFS compliance options and solutions to the blend wall, which they say has been intentionally created by the oil industry that has chosen not to take steps to address it. For instance, these groups argue the oil industry could encourage greater investment in E85 and its distribution. While API is still advocating for RFS repeal, it is reported that the group recognizes that outcome is unlikely in this Congress. Reportedly, this is the reason the group is working with ABFA on the advanced RINs amendment.