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 May 21, 2020, U.S. Senators Amy Klobuchar (D-MN) and Chuck Grassley (R-IA) introduced a bill directing the U.S. Department of Agriculture (USDA) Secretary to establish a renewable feedstock reimbursement program. Aiming to support biofuel producers that have been negatively affected by the COVID-19 pandemic, this bill can be cited as the Renewable Fuel Feedstock Reimbursement Act of 2020. Under the reimbursement program, biofuel producers will be reimbursed for their feedstock purchases from January 1, 2020, through March 31, 2020, through the Commodity Credit Corporation (CCC). Eligible parties will consist of those that produce renewable fuel used as transportation fuel and eligible feedstocks mean renewable biomass intended for production of the aforementioned renewable fuel. Furthermore, to be eligible to receive reimbursements, eligible entities must enter into an agreement with the USDA Secretary.

The two U.S. Senators initially introduced this idea in April 2020 as an amendment to the Coronavirus Aid, Relief, and Economic Stabilization (CARES) Act, which assists the biofuels industry sector. Assistance, however, was not included in the CARES Act package. Senators Klobuchar and Grassley, with industry support, now hope that this second attempt in support of the biofuels industry follows through.


 

By Lynn L. Bergeson

On May 18, 2020, USDA issued its final rule for the Biorefinery, Renewable Chemical, and Biobased Product Manufacturing Assistance Program (9003 Program), which incorporates the statutory definition changes as required in the Agricultural Act of 2018 (Farm Bill) and adopts the interim rule published on June 14, 2015. The 9003 Program replaces the Biorefinery Assistance Program (BAP), which guaranteed loans to fund the development, construction, and retrofitting of commercial-scale biorefineries using eligible technology. The final rule makes several specific changes to BAP, including:

  • Renames the program as the 9003 Program;
  • Revises the purpose statement for the program to include renewable chemicals and biobased product manufacturing;
  • Expands the program to include biobased product manufacturing facilities;
  • Adds definitions for “renewable chemicals” and “biobased product manufacturing”; and
  • Ensures diversity in the types of projects approved by the program.

The final rule became effective on May 18, 2020.


 

By Lynn L. Bergeson

On May 11, 2020, a total of 70 Mayors from various cities in the United States submitted a letter to Andrew Wheeler, U.S. Environmental Protection Agency (EPA) Administrator, criticizing the decision not to uphold the Renewable Fuel Standard (RFS) and not to reject proposed waivers under Section 211(o)(7) of the Clean Air Act. The Mayors state that this decision on waivers is already causing damage to the economy and will continue to devastate farmers, workers, and families who depend on the biofuels industry. The letter emphasizes:

The request for these waivers is unjustified under the law. Such waivers from RFS requirements may only be granted if there is a demonstration that the RFS causes severe economic harm to the economy as a whole. In reality, refiner market conditions are a result of plummeting demand for gasoline across the country, not compliance with the RFS. Further, the RFS already considers demand reduction by adjusting annual blending volumes to reflect actual motor fuel demand.

Furthermore, the signatory Mayors oppose the claim that higher Renewable Identification Numbers (RIN) prices damage biofuel refineries. Referencing an EPA market analysis, the Mayors argue that higher RIN prices are recovered in the sale of the product rather than disadvantaging merchant refiners. The letter concludes by requesting that EPA reject unjustifiable RFS waiver requests.

Tags: Biofuel, RFS

 

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

On May 12, 2020, a bill was introduced in the U.S. House of Representatives, which would make emergency supplemental appropriations for the fiscal year ending on September 30, 2020. Titled the Health and Economic Recovery Omnibus Emergency Solutions Act (HEROES Act), this bill addresses various issues, many of which have been worsened by the COVID-19 pandemic. Some of these issues include provisions of revenue, health, retirement, government operations, and support for processed commodities, among others.

Of particular interest to the biofuels industry is the bill’s introduction of a Renewable Fuel Reimbursement Program, which would make payments to eligible entities that experienced market losses due to the pandemic between January 1, 2020, and May 1, 2020. Eligible entities will consist of any facility that produced renewable fuel or advanced biofuel in calendar year 2019. The amount of payment to an eligible entity will be the sum of $0.45 multiplied by the number of gallons of qualified fuel produced in that period. Should a determination be made that an entity was unable to produce qualified fuel for one or more months during the applicable period due to the pandemic, $0.45 multiplied by 50 percent of the number of gallons produced in the corresponding month in 2019 will be paid.


 

By Lynn L. Bergeson

On April 28, 2020, U.S. Representative Abby Finkenauer (D-IA) introduced the Clean Fuels Deployment Act of 2020, which would fund installation and conversion of fuel pump infrastructure to deliver higher blends of biofuel. Co-sponsored by Representatives Angie Craig (D-MN), Don Bacon (R-NE), and Roger Marshall (R-KS), this bipartisan bill creates a clean fuels grant program with $600 million over a six-year period to help biofuel retailers. The plan is to assist retailers to offer higher ethanol blends; expand the geographic area selling ethanol blends; accelerate the deployment of fueling infrastructure; and support biodiesel, bioheat, and sustainable aviation fuel markets. A number of biofuels and energy associations and companies are in support of the bill. Thanking Representative Finkenauer for introducing the bill, Kelly Nieuwenhuis, representing the Iowa Corn Growers Association (ICGA), stated that the Clean Fuels Deployment Act will “expand long-term economic opportunities for farmers and biofuels producers.”


 

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

On April 17, 2020, U.S. Department of Agriculture (USDA) Secretary, Sonny Perdue, announced $19 billion to farmers and ranchers as part of its COVID-19 relief program. Aimed at providing critical support in maintaining the integrity of the U.S. food supply chain and ensuring that every American has access to the food needed, the funds will be used not only to directly support farmers and ranchers, but also for USDA purchase and distribution. The latter goal means that USDA will partner with regional and local distributors affected by the closure of businesses to purchase $3 billion in fresh produce, dairy, and meat. The distributors will then provide boxes of fresh food supplied to food banks and other non-profits serving Americans in need. The one element not mentioned in the use of the relief funds, however, was assistance for biofuel producers who are bearing the impact of decrease in consumption.

In early April, 15 U.S. Senators had submitted a bipartisan letter to Secretary Perdue, requesting the use of its authority to assist the biofuels industry’s economic circumstances brought by the COVID-19 pandemic. Highlighting the negative impacts of the pandemic on farmers and producers who are suffering from the impact of the decrease in consumption, the letter asked that USDA consider the allocation of additional funds to assist the biofuels industry sector. Assistance would be helpful in the format of reimbursements for feedstocks and additional relief funds to the Higher-Blends Infrastructure Incentive Program to drive future biofuel demand. At the time, the 15 signatories of the letter seemed hopeful of receiving the aid requested and much needed. It seems as though USDA’s focus, however, is not geared toward addressing the biofuel industry’s request. According to an article, Secretary Perdue addressed this issue by stating that it is not within his authority to extend the aid to energy production and that USDA does not have a fundamental way to help the biofuels sector.


 

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

On April 10, 2020, the European Commission (EC) announced the launch of its new online service that connects crop and food producers with biorefineries. This European Union (EU) project aims to address food waste by enabling crop producers, food processors, and agricultural cooperatives to sell their waste as feedstock for use by two biorefineries in Spain and Italy. The multi-feedstock biorefineries, designed by Agrimax, convert farming and food processing byproducts into compounds that can be used in biobased food packaging as well as in the biobased chemical and agricultural sectors. Agrimax is an EU-funded project focused on the development and demonstration of high-value products from crop and food-processing waste. Its work develops economically competitive routes to the commercialization of the products. The project is expected to end in September 2020; developers hope to make a positive impact in growth of the biobased and agricultural sectors.


 

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

On April 6, 2020, 15 United States Senators submitted a bipartisan letter to the U.S. Department of Agriculture (USDA) Secretary, Sonny Perdue, requesting the use of its authority to assist the biofuels industry’s economic circumstances brought by the COVID-19 pandemic. Highlighting the negative impacts of the pandemic on farmers and producers who will bear the impact of the decrease in consumption, in the letter, the Senators have also taken the opportunity to criticize the U.S. Environmental Protection Agency (EPA) for failing to implement the Renewable Fuel Standard (RFS). Specifically, the letter states that EPA has failed “to implement the RFS in accordance with the law, including its issuance of illegal small refinery waivers and enforcement of ethanol blending requirements.” The lack of proper implementation of RFS combined with the COVID-19 crisis, according to the Senators, further negatively impact the rural communities and employment rates in their respective home states.

Given these circumstances, the 15 signatories of the letter ask that USDA considers the allocation of additional funds provided to the Commodity Credit Corporation (CCC) by the Coronavirus Aid, Relief, and Economic Stabilization (CARES) Act to assist the biofuels industry sector. Assistance would be helpful in the format of reimbursements for feedstocks and additional CCC funds to the Higher-Blends Infrastructure Incentive Program to drive future biofuel demand. Although, Secretary Purdue has not yet responded to the aforementioned request, the biofuels industry is hopeful.


 

By Lynn L. Bergeson

On March 2, 2020, the U.S. Department of Energy (DOE) Office of Energy Efficiency and Renewable Energy (EERE) announced open meetings of the Biomass Research and Development (R&D) Technical Advisory Committee. Occurring on March 24, 2020, from 8:00 a.m. to 5:00 p.m. (EDT) and March 25, 2020, from 1:00 p.m. to 4:30 p.m. (EDT), both meetings will take place in Arlington, VA. The purpose of the meetings is to develop advice and guidance that promotes R&D leading to the production of biobased fuels and biobased products. Parties interested in participating in the meeting and/or making oral statements must contact .(JavaScript must be enabled to view this email address) five days prior to the meetings.

Tags: DOE, EERE, Biofuel

 

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

On February 26, 2020, the city of Helsinki announced the opening of applications for the Helsinki Energy Challenge (HEC), which aims to address challenges associated with urban heating produced with coal. According to its press release, Helsinki is one of the leading cities in the transition toward a sustainable future. Its aim is to achieve carbon neutrality by 2035. Currently, however, Helsinki needs solutions to meet its heat demand. Given Finland’s coal ban starting in 2029, Helsinki is seeking heating solutions that go beyond coal and beyond burning biomass. Helsinki Mayor, Jan Vapaavuori, stated that “[s]olving the urban heating challenge is crucial to reach global climate goals. Cities have a key role to play in the transition to a low carbon economy, and Helsinki is now taking an initiative to lead the way.” The city is inviting innovators from around the world to use Helsinki as a test bed to develop fossil-free and sustainable solutions in the fight against global warming.

Proposed solutions will be evaluated based on:

  • Climate impact;
  • Impact on natural resources;
  • Implementation schedule and feasibility;
  • Reliability and security of supply; and
  • Capacity.

HEC is open globally to consortiums, start-ups, established companies, research institutions, universities, research groups, and individual experts. Applications will be accepted until May 31, 2020. Finalists will be invited to a co-creation phase in early July 2020, which will include a 3-day boot camp, where they will be provided support to develop their proposals. After the boot camp, finalists will present their proposals to an international jury of experts, who will name the winner or winners. To be presented in November 2020, the winning solution will be awarded one million euros.


 
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