On August 20, 2014, DOE's National Renewable Energy Laboratory (NREL) announced a new NREL study demonstrating a potentially more economical way to use lignin to make renewable fuels and products. NREL states in the study that "[o]verall, this work demonstrates that the use of aromatic catabolic pathways enables an approach to valorize lignin by overcoming its inherent heterogeneity to produce fuels, chemicals, and materials."
A copy of the announcement is available online. A copy of the full study is available online.
On August 12, 2014, Virent announced that it has received fuel registration from EPA for its BioForm® gasoline in blends up to 45 percent. According to the company's press release, this registration means that the BioForm® gasoline may now be used in on-highway motor vehicles. The EPA testing work for the registration was funded by Virent's partner Royal Dutch Shell.
Virent's CEO Lee Edwards remarked in the company's press release on the announcement that "[s]ecuring EPA registration of our BioForm® Gasoline is further confirmation of Virent's high quality drop-in fuel and is another step towards commercializing our technology to produce renewable fuels and chemicals from biobased feedstocks."
A copy of Virent's press release is available online.
In an August 11, 2014, filing with the U.S. Securities and Exchange Commission, cellulosic biofuel company KiOR, Inc. (KiOR) reported that without any new financial commitments, the Company only has enough funding to operate through September 2014. This announcement is significant for the biofuels industry, as EPA had relied on KiOR's projected volumes of available cellulosic biofuels to make up a significant part of the 2013 cellulosic renewable volume obligations (RVO) under the federal RFS. In addition, biofuels and RFS supporters have cited KiOR as a success story for continued support for the advanced and cellulosic RVOs under the RFS.
DOE will reportedly join the U.S. Department of Agriculture's (USDA) "Farm to Fly" initiative to help promote the development and use of sustainable aviation biofuels. Under the initiative, USDA, Boeing, and the Air Transport Association of America are working together to accelerate the availability of commercially viable and sustainable aviation biofuels in the United States to increase domestic energy security, establish regional supply chains, and support rural development. The initiative was renewed in 2013 for another five years. More information on the "Farm to Fly" program is available online.
On July 2, 2014, the U.S. Department of Energy (DOE) Office of Energy Efficiency and Renewable Energy's Bioenergy Technology Office published in the Federal Register a "Request for Information (RFI) Regarding Integrated Biorefinery Lessons Learned and Best Practices."
According to the RFI, its purpose is "to solicit feedback from industry, academia, research laboratories, government agencies, and other stakeholders on issues related to lessons learned and best practices developed during the design, financing, construction, commissioning, startup, shakedown and operations of pilot-, demonstration-, and commercial-scale integrated biorefineries."
A copy of the RFI is available online. Comments are due by July 15, 2014.
On June 26, 2014, the Congressional Budget Office (CBO) issued a 38-page report on the federal Renewable Fuel Standard (RFS), "The Renewable Fuel Standard: Issues for 2014 and Beyond." The report examines potential compliance with the RFS through 2017 under three scenarios and evaluates the effects on food and fuel prices under each one. A copy of CBO's summary of the report is available online. A copy of the full report is available online.
The report evaluated the impact on food and fuel prices under the following three RFS scenarios through 2017: compliance with the RFS requirements for advanced, biodiesel, and corn ethanol (not cellulosic); compliance with the RFS volume requirements consistent with EPA's proposed 2014 RFS requirements; and repeal of the RFS requirements. While CBO found that food prices would be similar whether the RFS is continued or repealed, it found varying potential effects on fuel prices. For instance, CBO concluded that continuing RFS statutory requirements through 2017 would lead to increased price of all types of transportation fuels, except E85.
Advocates on both sides of the RFS debate are already using the report. Some opponents have already argued that the report's findings further support reforming or repealing the RFS. Some RFS supporters have dismissed the report's conclusions as contrary to those of other respected economists who have studied the RFS and come to different conclusions. The report comes as RFS stakeholders are eagerly awaiting EPA's release of its final 2014 RFS rule.
On June 30, 2014, the U.S. Supreme Court announced that it would not review the constitutionality of the California Low Carbon Fuel Standard (LCFS). This decision is largely viewed as a win for the California Air Resources Board, the governmental body that regulates the LCFS, and supporters of the law.
On March 20, 2014, Growth Energy and the Renewable Fuels Association (RFA), which represent the ethanol industry, and the American Fuel and Petrochemical Manufacturers (AFPM), along with the American Trucking Association and the Consumer Energy Alliance, filed petitions for writ of certiorari with the U.S. Supreme Court to make a final determination on the constitutionality of the LCFS.
The groups challenged the January 2014 decision of the U.S. Court of Appeals for the Ninth Circuit (the Ninth Circuit) to deny rehearing en banc in Rocky Mountain Farmer's Union v. Corey. On September 18, 2013, the Ninth Circuit issued its opinion in Rocky Mountain Farmer's Union v. Corey reversing a lower court opinion that found that the LCFS violated the dormant Commerce Clause of the U.S. Constitution by discriminating against ethanol produced outside of California. The LCFS assigns higher carbon intensity values to ethanol produced in the Midwest than in California.
On June 20, 2014, the U.S. House of Representatives passed its version of the fiscal year (FY) 2015 appropriations bill to fund the U.S. Department of Defense (DOD), H.R. 4870, including language repealing Section 526 of the Energy Independence and Security Act of 2007 (Section 526). Section 526 prohibits federal agencies from procuring synfuel unless its lifecycle GHG emissions are less than those for conventional petroleum sources.
BRAG reported that last month the U.S. House of Representatives passed its version of the FY 2015 National Defense Authorization Act, H.R. 4435, including language exempting DOD from complying with Section 526. A copy of that BRAG report is available online.
Since Section 526 was passed in 2007, there has been an annual attempt to repeal or modify the language to reduce DOD's obligations pursuant to it. The biofuels industry generally has advocated against repealing this Section of the law.
On June 20, 2014, the National Biodiesel Board (NBB) filed a petition with the U.S. Court of Appeals for the District of Columbia Circuit requesting that the court rehear whether Monroe Energy (Monroe), a refining subsidiary of Delta Airlines, had standing to challenge EPA's final rule setting the 2013 Renewable Fuel Standard (RFS). BRAG reported on the court's recent denial of Monroe's challenge to that final rule. A copy of that report is available online.
As BRAG reported, the court held that EPA properly utilized its authority under the federal RFS to set the 2013 RFS volume requirements. The court disagreed with Monroe that EPA did not sufficiently consider factors in setting the final 2013 RFS rule, including the means of compliance for obligated parties. NBB wants the court to find that Monroe did not have standing to bring the challenge to the 2013 final RFS rule because the Company failed to show that a change to the rule would have changed the way that third parties acted with respect to their Renewable Identification Numbers. Reportedly, NBB would like the court to narrow the scope of groups that may bring challenges to the annual RFS rules set by EPA as part of the trade association's efforts to protect the RFS law.
Last week, the U.S. House of Representatives and the U.S. Senate Committee on Armed Services passed versions of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2015 that included starkly different provisions on biofuels. The House version would severely limit U.S. Department of Defense (DOD) authority to promote the procurement of biofuels. For instance, it included a provision that would allow DOD to procure biofuels only if their costs were "equivalent to" conventional fuels. In addition, it included provisions preventing DOD from supporting the planning and construction of a biorefinery and exempting DOD from complying with Section 526 of the Energy Independence and Security Act of 2007 (Section 526). Section 526 prohibits federal agencies from procuring synfuel unless its lifecycle GHG emissions are less than those for conventional petroleum sources.
The version of the FY 2015 NDAA passed by the U.S. Senate Committee on Armed Services does not include an exemption from Section 526. In addition, it includes several provisions to allow DOD to further its goals to increase its purchase and use of biofuels. For instance, it would allow DOD to utilize its authority under the Defense Production Act to fulfill its part of a 2011 joint initiative among the Departments of Agriculture, Energy, and the Navy to facilitate the production of U.S. "drop-in" biofuels for military and commercial use.