By Lauren M. Graham, Ph.D.
On May 29, 2017, UPM Biofuels announced that its BioVerno renewable diesel and BioVerno sidestream products, including naptha, turpentine, and pitch, received certification from the Roundtable on Sustainable Biofuels (RSB). BioVerno renewable diesel is manufactured from crude tall oil, a residue of pulp production. The RSB Certification evaluates the sustainability of biobased products against 12 principles that have been approved by non-governmental organizations (NGO), United Nations (UN) agencies, and other stakeholders and demonstrates compliance with the European Union Renewable Energy Directive’s sustainability criteria.
By Kathleen M. Roberts
On April 25, 2017, the U.S. Department of Agriculture’s (USDA) Rural Business-Cooperative Service published in the Federal Register a notice that it is requesting approval from the Office of Management and Budget (OMB) of a revision to a currently approved information collection for the Advanced Biofuel Payment Program, which provides funding to eligible advanced biofuel producers to support the production of biofuel products. The Rural Business-Cooperative Service is specifically seeking comments on the following topics:
- Whether the proposed collection of information is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility;
- The accuracy of the agency's estimate of the burden of the proposed collection of information including the validity of the methodology and assumptions used;
- Ways to enhance the quality, utility, and clarity of the information to be collected; and
- Ways to minimize the burden of the collection of information on those who are to respond, including the use of appropriate automated, electronic, mechanical, or other technological collection techniques or other forms of information technology.
Comments on this notice, which are due by June 26, 2017, will be summarized and included in the request for OMB approval.
By Lauren M. Graham, Ph.D.
On April 24, 2017, Bob Dineen, President and CEO of the Renewable Fuels Association (RFA) sent a letter to EPA Administrator Scott Pruitt requesting that the 2018 Renewable Fuel Standard (RFS) Renewable Volume Obligations (RVO) rulemaking remain on schedule and maintain the conventional renewable fuel requirement at the statutory level of 15 billion gallons. According to the letter, regulatory certainty and sufficient lead time for planning are required to allow regulated parties to adapt and comply with the RFS.
The letter states that ethanol producers are set to produce a record supply of 16 billion gallons of conventional renewable fuel in 2017, which is well above the 15-billion-gallon conventional renewable fuel RVO, and refiners and blenders have increased the inclusion of ethanol in U.S. gasoline. Additionally, data from the Energy Information Administration (EIA) demonstrates that, on average, the ethanol content of gasoline consumed in the U.S. in 2016 was above the purported “blend wall.” Dinneen urged Pruitt to ensure a timely RVO rulemaking process to allow the evolution of the marketplace to continue.
On March 7, 2017, the Governors’ Biofuels Coalition sent a letter to President Trump requesting the Administration’s support for changes to various federal policies to strengthen biofuels production and expand markets for ethanol and other biofuels. The letter, which was signed by Nebraska Governor Pete Ricketts and Iowa Governor Terry Branstad, specifically highlights the need for the Trump Administration to change the fuel volatility limitations placed on E15, to update corn ethanol’s lifecycle carbon emissions profile to reflect advances in ethanol production technology, and to update the 2014 motor vehicle emission simulator model to prohibit spurious comparisons of high- and low-ethanol emissions factors. The governors commended Trump on his support of the biofuels industry over the past year and stated that expanding biofuels production is one of the best ways to meet the nation’s energy needs.
On February 22, 2017, the DOE’s Office of Fossil Energy announced seven recipients of $5.9 million in funding to develop novel ways to use carbon dioxide (CO2) captured from coal-fired power plants. The projects will focus on converting captured CO2 to useable products. Recipients of the funding include:
||The University of Kentucky Research Foundation will receive nearly $1 million to convert CO2 to bioplastics using microalgae. In addition to developing a strategy to maximize value from the algae biomass, researchers will aim to decrease the cost of algae cultivation;
||Researchers at the University of Delaware will receive $800,000 to develop a two-stage electrolyzer process for the conversion of CO2 to alcohols, such as ethanol and propanol;
||The Gas Technology Institute will receive nearly $799,997 to develop a Direct E-Beam Synthesis process to produce chemicals, such as acetic acid, methanol, and CO, from CO2, and an additional $799,807 to develop a novel catalytic reactor process to convert CO2 into methane for syngas production;
||TDA Research, Inc. will receive nearly $799,985 to develop a sorbent-based, thermo-catalytic process to convert CO2 into syngas; and
||Southern Research will receive $799,442 to develop a process to produce light olefins, such as ethylene and propylene, from coal-fired flue gas using novel nano-engineered catalysts.
On February 4, 2017, the Canadian Department of the Environment and the Department of Health published in the Canada Gazette the draft screening assessment of the commercially relevant fungus, Trichoderma reesei, stating that the organism is nontoxic and does not require regulatory action under Section 77 of the Canadian Environmental Protection Act (CEPA). Following a screening assessment, Trichoderma reesei , which is used to convert biomass to biofuels and sugars and to produce food and health products, was found to not meet the criteria set out in CEPA Section 64 since the amount entering the environment does not pose a risk to human health. Options are being considered, however, for follow-up activities to track changes in the commercial use of and exposure to Trichoderma reesei . Comments on the draft assessment and the related scientific considerations are due by April 5, 2017.
On January 31, 2017, two bills were introduced in the U.S. Congress that propose to reform the Renewable Fuel Standard (RFS) and the national biofuels mandate. The first bill would require the National Academy of Sciences (NAS) to assess the performance, safety, and environmental impact of mid-level ethanol, and the implications of the use of mid-level ethanol blends compared to gasoline blends containing ten percent or less ethanol. The second bill would reduce the U.S. Environmental Protection Agency’s (EPA) cellulosic biofuel volume requirements under the RFS program to what is commercially available pending a NAS report on the environmental and economic impacts and feasibility of large scale production of cellulosic biofuel.
The biofuels industry is likely to face increasingly challenging times during the tenures of the new 115 th Congress -- which began on January 3 -- and the Trump Administration, scheduled to begin this Friday, January 20.
Throughout his campaign for President, Trump repeatedly pledged his support for biofuels and the federal Renewable Fuel Standard (RFS). Indeed, it is this support that helped Trump win in key Midwestern battleground states, including Iowa. Despite this, Trump has nominated fossil fuel supporters and anti-biofuels advocates to three key Cabinet positions. His nominee for U.S. Secretary of State, Rex Tillerson, is the former CEO of Exxon Corporation. Exxon and other RFS-obligated parties have been actively fighting for the repeal of the RFS since 2012. The nominee to head the U.S. Department of Energy (DOE), former Republican Texas Governor Rick Perry, has close ties with the fossil fuel sector, did not actively support the RFS during his two Presidential campaigns, and has in the past called for the elimination of the DOE, as well as mandates that “skew” the energy marketplace. In addition, Governor Perry petitioned the U.S. Environmental Protection Agency (EPA) in 2008 for a 50 percent waiver of the RFS requirements, which EPA denied. He has also taken positions against issue-specific tax incentives and any specific incentives for new energy development. Finally, Scott Pruitt is the nominee to lead EPA. In his current role as the Republican Oklahoma Attorney General, Pruitt has ties to fossil fuel groups and has sued EPA 19 times -- the very agency he is nominated to run -- over the RFS and the Clean Power Plan, among other major regulations under the purview of EPA.
On Wednesday, January 18, the U.S. Senate Committee on Environment and Public Works (EPW) held its hearing to consider the nomination of Pruitt to become the Administrator of EPA. Pruitt indicated in a meeting earlier this month and during his nomination hearing before the EPW Committee that, as EPA Administrator, he would administer the RFS law as Congress intended.
On January 5, several U.S. Senators from Midwestern states met with Pruitt to discuss their concerns over his criticism of the RFS, among other policies. Reportedly, these Senators emerged from the meeting reassured that Pruitt would follow the RFS law. The RFS law, however, provides the EPA Administrator discretion in his implementation of the law. For instance, one potential change to the regulations implementing the RFS currently being considered and on which public comment is being solicited is whether to change the point of obligation under the RFS, which would shift the obligated parties downstream to fuel marketers, including gas stations. Such regulatory changes to the implementation of the RFS law could have detrimental effects on its intended purpose to increase the volumes of biofuels that are blended and used in our nation’s fuel supply.
During Pruitt’s nomination hearing, he reiterated his commitment to implementing the RFS law as Congress intended, despite his past statements that the RFS law is “flawed” and “unworkable.” Pruitt explained that he believes that the EPA Administrator’s waiver authority under the RFS should be used “judiciously.” He suggested, however, that implementation of the RFS could be improved.
Generally, biofuels advocates have argued that there is no need for legislation to change -- and certainly not to repeal -- the RFS. While there still exists ardent RFS support in both Houses of Congress, biofuels advocates will likely face greater challenges to their efforts to prevent the passage of legislation that would alter or repeal the RFS, or to alter or repeal other existing biofuels incentives. For instance, at a recent hearing, Senator John McCain (R-AZ) voiced his ongoing disapproval of the military’s focus on developing and using alternative fuels since they have been more expensive than fossil fuels.