UpdateCorrected: Interest groups differ on US renewable fuel standards

09 June 2009 21:50  [Source: ICIS news]

Interest groups speak out on standardsCorrection: In the ICIS news story headlined "Interest groups differ on US renewable fuel standards" dated 9 June 2009, please read in the fifth paragraph …Calmes … instead of … Cheviron …. A corrected story follows.

(Adds new first paragraph, more details throughout)

HOUSTON (ICIS news)--Renewable fuel advocates, environmentalists and lawmakers on Tuesday tussled on the merits and pitfalls of proposed renewable fuels standards (RFS) that could make or break many US biofuels companies.

Environmental Protection Agency (EPA) officials listened to testimony relating to its proposal that 36bn gal of biofuels be blended into the nation’s fuel supply by 2022. The hearings kicked off a six-month public comment period on how the agency would carry out its proposed RFS standards.

Speakers debated the EPA’s planned measurements of indirect land usage. Those provisions measure how much greenhouse gas grain-based biodiesel emits throughout its lifetime, from growing the feedstock crops to refining the fuel. 

Biodiesel producers dependent on soybeans as a feedstock would lose out under the EPA’s current indirect land use measurements. The agency’s measurement models find soybean-based biodiesel emits too much greenhouse gas to qualify for blending under RFS.  

“The modeling used to measure these impacts have not been fully developed,” ADM vice president Mark Calmes told the panel in Washington DC. “It is at odds with what is observed with indirect land usage and undermines the market’s committment to today’s biofuels and the development of tomorrow’s biofuels.”

The EPA has defended its models, saying they are sufficient to measurement biodiesel’s true environmental impact.

The agency also had its defenders, including Michael O’Hare, the principal researcher for the California Air Resource Board (CARB) when that state agency proposed regulations on low carbon fuels.

“Indirect land use change is real,” O’Hare said. “It’s highly consequential. The EPA’s approach at this point is intellectually responsible.”

The National Biodiesel Board (NBB) has been fighting against the indirect land use provisions, saying it would force the closure of many biodiesel plants and prevent the country from meeting the proposed biodiesel blending benchmarks.

The biodiesel industry in particular has a great deal at stake in seeing the RFS implemented. Many producers got into the market expecting the RFS to call for 500m gal of their product to be blended into the fuel supply by 2022.

Producers were struggling to survive in the wake of collapsed world credit markets, EU tariffs on imported US biodiesel and decreased fuel demand in the US.

US Representative Collin Peterson (Democrat-Minnesota) introduced a bill last month that would strip the indirect land use language from the RFS. That bill is stalled in the US House energy and commerce committee.

Bookmark Simon Robinson’s Big Biofuels Blog for some independent thinking on biofuels
For more information on ethanol and biodiesel, visit ICIS chemical intelligence
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By: Ben Lefebvre
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