The Biobased and Renewable Products Advocacy Group (BRAG) helps members develop and bring to market their innovative biobased and renewable chemical products through insightful policy and regulatory advocacy. BRAG is managed by B&C® Consortia Management, L.L.C., an affiliate of Bergeson & Campbell, P.C.

By Lynn L. Bergeson

On July 5, 2019, EPA Administrator Andrew Wheeler signed a proposed rule to set the minimum amount of renewable fuels that must be supplied to the market in 2020, as well as the biomass-based diesel volume standard for 2021 under the Renewable Fuel Standards (RFS) program. The notice means that EPA is on target to publish the final RFS Renewable Volume Obligations (RVO) on time. In Wheeler’s announcement, he highlights that its timeliness contrasts with the Obama Administration’s failure to release RVOs by the date Congress set forth. Despite Wheeler’s timeliness, however, EPA has been highly criticized by the National Biodiesel Board (NBB) and politicians who have demonstrated opposition to the set RVOs. Details on the proposed RVOs for 2020 can be found here.

Tags: Biofuel, RFS

 

By Lynn L. Bergeson

On June 18, 2019, Representative Mike Thompson, (D-CA), Chair of the House Ways and Means Subcommittee on Select Revenue Measures, introduced the Taxpayer Certainty and Disaster Tax Relief Act of 2019. The bill includes:

  • An extension of the $1-per-gallon tax credit for biodiesel and biodiesel mixtures;
     
  • An extension of the small argi-biodiesel producer credit of 10 cents per gallon through 2020;
     
  • An extension of the second generation biofuel producer credit through 2020;
     
  • A $1.01-per-gallon nonrefundable income tax credit for second generation biofuel sold at retail into the fuel tank of a buyer’s vehicle, or second generation biofuel mixed with gasoline or a special fuel and sold or used as fuel (previously known as the cellulosic biofuel producer credit);
     
  • An extension of the alternative fuel refueling property credit through 2020;
     
  • A credit for the installation of alternative fuel vehicle refueling property, which includes property that dispenses alternative fuels, including ethanol, biodiesel, natural gas, hydrogen, and electricity;
     
  • An extension of the special allowance for second generation biofuel plant property through 2020 and an additional first-year 50 percent bonus depreciation for cellulosic biofuel facilities; and
     
  • The Section 45 tax credit for renewable energy would be extended through 2020, or one year in the case of wind facilities.

By extending a number of provisions that expired in 2017 and 2018, and preemptively extending provisions set to expire in 2019, Representative Thompson aims to reverse the trend of allowing important tax provisions to expire before being renewed, and rather consistently extend them on a forward-looking basis to provide greater certainty for taxpayers.

Tags: Tax, Biofuel

 

 

By Lynn L. Bergeson

On June 14, 2019, U.S. Senators Deb Fischer (R-NE) and Tammy Duckworth (D-IL) introduced the Renewable Fuel Standard (RFS) Integrity Act of 2019. This Act aims at increasing transparency and predictability to the U.S. Environmental Protection Agency’s (EPA) small refinery exemption process under the RFS program. Requiring small refineries to petition for exemptions by June 1 of each year, according to the two leaders, this legislation would hold EPA accountable for exempted gallons in the annual Renewable Volume Obligation (RVO) it sets every November. It is known that, since 2018, many complaints have been made regarding President Trump’s EPA liberally providing exemptions to refineries with no back-up information or congressional oversight. This Act attempts to address this issue by making key information associated with exemptions made publicly available. Additionally, if passed, the Act would require EPA to report to Congress on the methodology it uses when granting these small refinery exemptions.


 

By Lynn L. Bergeson

On June 3, 2019, 19 members of Congress submitted a letter to U.S. Speaker of the House, Nancy Pelosi (D-CA), and Chair of the House Committee on Ways & Means, Richard Neal (D-MA), addressing the expired Second-Generation Biofuel Producer Tax Credit, the Special Depreciation Allowance for Second-Generation Biofuel Plant Property, and the Alternative Fuel Vehicle Refueling Property Credits. Urging Congress to take action on the extension of these tax credits, the letter emphasizes the importance of these credits in stabilizing capital intensive, higher-risk technology projects and in allowing more time to plan for longer-term policy around alternative fuels and infrastructure. The extension request proposes that the House Ways & Means Committee consider a multi-year extension of these credits to reassure the second-generation biofuels, the rural economy, and the refueling infrastructure industry.

Tags: Biofuel, Tax

 

By Lynn L. Bergeson

On May 31, 2019, the Federation of Petroleum Suppliers (FPS) launched Clean Growth Future Vision, a document outlining FPS’ vision for cutting carbon through the development of biofuels. FPS is a trade association for the liquid fuels distribution industry and ancillary interests in the United Kingdom (UK) and the Republic of Ireland. FPS urges the government to be technology neutral and to consider options other than electrification. Guy Pulham, FPS’ Chief Executive, commented that in the short-term, consumer encouragement to make energy efficiency changes are necessary to reduce carbon emissions. In the long-term, Pulham stated that FPS intends to work with relevant bodies and consumer groups to ensure various solutions can be found for different homes and budgets. FPS will also work on testing low-carbon fuels and working with the supply chain to reduce fossil fuel content in liquid fuels. The goal is to reach zero fossil fuel content by the Paris Agreement deadline.

Tags: Biofuel

 

By Lynn L. Bergeson

On May 30, 2019, the U.S. Environmental Protection Agency (EPA) released in final the regulatory changes allowing gasoline blended with up to 15 percent ethanol (E15) to take advantage of the 1-psi Reid Vapor Pressure (RVP) waiver that applies to E10 during the summer months. This means that E15 can now be sold year-round in the U.S. without additional RVP control rather than just eight months of the year. EPA also released in final the rulemaking regulatory changes to modify certain elements of the renewable identification number (RIN) compliance system under the Renewable Fuel Standard (RFS) program. Aiming to increase transparency to the market and deter price manipulation, the reforms to RIN markets include a requirement for public disclosure when RIN holdings exceed specified thresholds, and the collection of additional data to improve EPA oversight.

Tags: EPA, E15, Biofuel

 

By Lynn L. Bergeson

On June 2, 2019, the International Air Transport Association (IATA) announced the approval, by the IATA 75th Annual General Meeting (AGM), of the United Nations’ (UN) International Civil Aviation Organization (ICAO) resolution, which calls governments to continue work on the implementation of the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). The first global carbon pricing instrument for an industry sector, CORSIA will cap carbon dioxide emissions from international aviation at 2020 levels (carbon-neutral growth (CNG)). Between 2020 and 2035, CORSIA aims to mitigate over 2.5 billion tonnes of carbon dioxide generating at least $40 billion in finance for carbon reduction initiatives. AGM urged ICAO member states to take a number of measures:

  • Consider participation in CORSIA in the pilot phase;
     
  • Align domestic regulations on the monitoring, verification, and reporting of emissions with CORSIA’s standards, preventing market distortions through its requirements;
     
  • Implement CORSIA as the single global market-based mechanism for climate change mitigation; and
     
  • Avoid the implementation of overlapping/duplicate measures such as unilateral carbon taxes.

IATA’s Director General and Chief Executive Officer (CEO) stated: “CORSIA is a landmark accomplishment. It is a concrete, well-defined way forward to cap global emissions from international aviation. States must not compromise it with inconsistent implementation or by adding a patchwork of taxes on top of it. Its vital mission is to stop growth in net emissions from aviation.” AGM also discussed steps beyond CORSIA, setting the goal to cut net emissions by half of 2005 levels by 2050. Focused on a long-term strategy, IATA calls for investments in better efficiency measures such as sustainable aviation fuels, new aircrafts, and better procedures.


 

By Lynn L. Bergeson and Ligia Duarte Botelho, M.A.

On May 31, 2019, the Brazilian government’s Ministry of Energy’s Empresa de Pesquisa Energética (EPE -- Energy Research Company) held an auction for the supply of sustainable energy and biofuel sources for the State of Roraima’s capital, Boa Vista, and its neighboring areas. A federal energy company, EPE provides the Ministry of Energy with R&D services designed for subsidies of the energy sector, covering electricity, petroleum, natural gas and its derivatives, and biofuels. Out of 156 competitions, the nine auction winners presented projects on natural gas, biodiesel, biomass, hybrid solutions, biofuels, solar, and photovoltaic batteries. Winners totaled a capacity of 294 megawatts (MW) to be installed, including seven renewable sources, which will have 15-year contracts and a diesel power plant for seven years starting in June 2021.


 

 
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