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.
By Lauren M. Graham, Ph.D.
On August 3, 2017, Minnesota Governor Mark Dayton announced that the state will implement a new biodiesel standard in May 2018 that will increase the biodiesel blend mandate from 10 percent (B10) to 20 percent (B20) between April and September each year. Currently under the state’s biodiesel program, diesel fuel sold in Minnesota must contain at least 10 percent biodiesel during the summer months, with the blend lowering to 5 percent from October to March. While the new mandate doubles the blend requirement during the summer months, the mandate will revert back to 5 percent over the winter months unless state officials and technical experts determine that accepted federal standards deem certain higher blends as suitable for year-round use in Minnesota.
Since a large portion of Minnesota’s biodiesel is made from homegrown soybeans, the new standard is expected to add an average of 63 cents to the market price of a bushel of soybeans for Minnesota farmers, and reduce carbon dioxide emissions by approximately 1 million tons next year. Minnesota’s biodiesel industry is estimated to contribute more than $1.7 billion annually to the economy, with the state’s three biodiesel plants producing a combined 74 million gallons of biodiesel annually.
By Lauren M. Graham, Ph.D.
On July 26, 2017, the U.S. Environmental Protection Agency (EPA) published its analysis of the upstream greenhouse gas (GHG) emissions attributable to the production of sugar beets for use as a biofuel feedstock. EPA considered a scenario in which non-cellulosic beet sugar is extracted for conversion to biofuel and the remaining beet pulp co-product is used as an animal feed. Based on the findings, EPA anticipates that biofuels produced from sugar beets could qualify as a renewable fuel or advanced biofuel under the Renewable Fuel Standard (RFS) program, depending on the type and efficiency of the fuel production process technology used.
Comments on the analysis are due by August 25, 2017. The pre-publication version of the notice was issued on January 18, 2017, as previously reported in the Biobased and Renewable Products Advocacy Group (BRAG®) blog post EPA Seeks Comments on GHG Analysis of Sugar Beets for Biofuel Feedstock.
By Lauren M. Graham, Ph.D.
On July 20, 2017, the U.S. Department of Agriculture's (USDA) National Institute of Food and Agriculture (NIFA) awarded 34 grants totaling $15.1 million for research on renewable energy, biobased products, and agroecosystems. The grants, which are funded through the agency’s Agriculture and Food Research Initiative (AFRI), are expected to help develop the next generation of renewable energy, bioproducts, and biomaterials; protect the ecosystems that support agriculture; and improve the agricultural systems and processes that help feed the nation.
The following institutions were awarded grants for projects focused on cover crop systems for biofuel production:
- USDA Agricultural Research Service (ARS) received $494,000 for the development of lupin, cereal rye, and carinata winter cover crops for biomass in the southern coastal plain;
- Purdue University received $498,000 for the development of cover cropping for the development of sustainable co-production of bioenergy, food, feed (BFF) and ecosystem services (ES);
- Iowa State University of Science and Technology received $498,378 for the development of perennial cover crop systems for maize grain and biomass production;
- Louisiana State University Agricultural Center received $387,000 to study the feedstock production potential of energy cane-sweet sorghum rotation with a winter cover crop system; and
- University of Nebraska received $500,000 to assess innovative strategies to maximize cover crop yields for biofuel across a precipitation gradient.
The following institutions were awarded grants for projects focused on the socioeconomic implications and public policy challenges of bioenergy and bioproducts market development and expansion:
- Auburn University received $499,886 to identify the economic barriers to biomass production, to evaluate the effectiveness of the Biomass Crop Assistance Program (BCAP) in stimulating biomass market expansion, and to explore the economic and ecosystem service implications of biomass production;
- Colorado State University received $499,000 to produce a unified atlas of marginal lands in the U.S., and provide insight on the costs, potential environmental benefits, and overall practical likelihood of using those lands for biomass feedstock production;
- Purdue University received $492,099 to develop a dynamic theoretical model on rejuvenating coal-power plants with biomass;
- Iowa State University of Science and Technology received $499,622 to provide an integrated model-based assessment of the socioeconomic, policy, and market implications of sustainable bioenergy derived from cellulosic biomass; and
- University of Missouri received $498,441 to evaluate impacts on forest resources surrounding power plants using woody biomass, assess economic impacts of wood biopower systems, and quantify tradeoffs between cost, carbon reductions, and renewable energy generation obtained by the increased use of wood biopower.
More information on the grants is available at the NIFA website
By Kathleen M. Roberts
On July 25, 2017, the National Biodiesel Board (NBB) announced that the California Air Resource Board (CARB) certified a biodiesel additive that will make California B20 blends the cleanest diesel fuel with the lowest emissions profile available in the U.S. The additive known as Branded VESTA™1000 reduces every measurable regulated emission, including nitrogen oxides (NOx), when blended with CARB diesel fuel, California’s unique clean-burning biodiesel formulation. A 20 percent blend of biodiesel with the additive reduced NOx by 1.9 percent and particulate matter by 18 percent compared to CARB diesel. The certified additive ensures compliance with CARB’s Alternative Diesel Fuel Regulation, which goes into effect on January 1, 2018. NBB led the initial research and development of the additive.
By Kathleen M. Roberts
On July 18, 2017, the U.S. Environmental Protection Agency (EPA) published in the Federal Register its proposed rule on the Renewable Fuel Standard (RFS) Program: Standards for 2018 and Biomass-Based Diesel Volume for 2019. The rulemaking proposes the annual percentage standards for cellulosic biofuel, advanced biofuel, and total renewable fuel for motor vehicle gasoline and diesel produced or imported in 2018, as well as biomass-based diesel in 2019, as reported in the Biobased and Renewable Products Advocacy Group’s (BRAG®) blog post EPA Releases Proposed 2018 RFS Volume Requirements. The proposed volume requirements are:
- 238 million gallons for cellulosic biofuel in 2018, down from 311 million gallons in 2017;
- 4.24 billion gallons for advanced biofuel in 2018, down from 4.28 billion gallons in 2017;
- 19.24 billion gallons for renewable fuel in 2018, down from 19.28 billion gallons in 2017; and
- 2.1 billion gallons for biomass-based diesel in 2018 and 2019.
These volumes would set the percentage standards at 0.131 percent for cellulosic biofuel, 2.34 percent for advanced biofuel, 10.62 percent for renewable fuel, and 1.74 percent for biomass-based diesel. Comments on the proposed rule must be received by August 31, 2017
While the proposed reduction in the amount of renewable fuel is relatively small, many in the biofuels industry are concerned that it sends the signal to the market that the U.S. renewable fuel industry will no longer grow. The proposed volume requirements may undercut the Administration’s goal of reducing U.S. reliance on foreign energy and reviving U.S. manufacturing, despite President Trump’s repeated pledge to support the ethanol industry.
As previously reported in the BRAG blog post EPA Announces Public Hearing On RFS Program,
EPA will hold a Public Hearing for Standards for 2018 and Biomass-Based Diesel Volume for 2019 Under the RFS Program
to listen to arguments from all interested stakeholders to inform future rulemakings on the volume requirements. The hearing will take place at 9:00 a.m. on August 1, 2017
, in Washington, D.C. EPA has until November 30, 2017
, to issue the rulemaking in final.
By Lauren M. Graham, Ph.D.
On July 14, 2017, the Royal Academy of Engineering (Academy) published a report on the sustainability pros and cons of biofuels, which was commissioned by the Department of Transport and the Department for Business, Energy and Industrial Strategy. The report aims to provide advice on the future strategy for the development of biofuels in the United Kingdom (UK). In its statement announcing the report, the Academy stated that biofuels, particularly second generation biofuels from waste and byproducts, have a role to play in meeting the UK commitment to climate change mitigation. While such biofuels have the potential to be sustainable and make a real impact, the Academy warned that action is needed to manage risks, improve traceability, and avoid fraudulent practice.
The report calls on government to incentivize the development of second generation biofuels in the UK, specifically those derived from wastes and agricultural, forest, and sawmill residues, and to incentivize the use of marginal land, such as land unsuitable for food production or housing, for the production of biofuels. The Academy also recommended that the government properly regulate the biofuels sector with clear and consistent categorization of wastes and residues to help avoid unintended market distortions within the UK and internationally, and that other sustainability issues, such as competitiveness of biofuels with fossil fuels; food, energy and water security; employment provision; rural development; and human health impacts, be evaluated.