Biobased and Renewable Products Update
August 17, 2017
DOC
DOC Postpones Biodiesel AD/CVD Investigation Preliminary Determinations
On August 15, 2017, the U.S. Department of Commerce’s (DOC) International Trade Administration (ITA) announced in the Federal Register that the preliminary determination in the antidumping (AD) and countervailing duty (CVD) investigations on biodiesel from Argentina and Indonesia will be postponed. A request to postpone the determinations was submitted by a petitioner on July 6, 2017, and, pursuant to Section 733(c)(1)(A) of the Tariff Act of 1930, ITA determined that there was no compelling reason to deny the request. The preliminary determination will now be due by October 19, 2017, and the final determination will be due within 75 days of the issuance of the preliminary determination.
ITCA previously postponed the determinations following a May 22, 2017, request from a petitioner, as reported in the Biobased and Renewable Products Advocacy Group (BRAG®) blog post DOC Postpones Preliminary Determinations for Biodiesel AD/CVD Investigation.
Industry
Biofuel Industry Testifies At EPA Hearing On RFS Program
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.
EIA Publishes February Biodiesel Production Report
On July 31, 2017, the U.S. Energy Information Administration (EIA) released its monthly biodiesel production report for May 2017. According to the report, U.S. biodiesel production increased by nine million gallons between April and May of this year, and by 1 million gallons compared to May 2016. The Midwest (Petroleum Administration for Defense District 2) accounted for 69 percent of the total U.S. biodiesel produced. The report also states that 66 million gallons of 100 percent biodiesel (B100) were sold, and an additional 82 million gallons of B100 were sold in biodiesel blends. Of the 1,054 million pounds of feedstocks used to produce biodiesel in May 2017, soybean oil remained the largest biodiesel feedstock with 546 million pounds consumed in May.
Research
Sandia National Laboratories Studying Algae To Clean Polluted Water And Produce Biofuel
Sandia National Laboratories (Sandia) is investigating whether algae can be used to transform the Salton Sea, one of California’s largest and most polluted lakes, into a productive and profitable resource. The Salton Sea Biomass Remediation project (SABRE), which is funded by the U.S. Department of Energy’s (DOE) Bioenergy Technologies Office (BETO), aims to use algae to rid the lake of pollutants while creating a renewable, domestic source of fuel and other chemicals. Algae are known to thrive in environments like the Salton Sea, which contains elevated levels of nitrogen and phosphorus due to agricultural runoff.
In the first phase of the project, Sandia partnered with Texas A&M AgriLife Research to investigate the efficacy of a new algal farming method, known as the “Algal Turf Scrubber” floway system. The algae consume the nitrogen and phosphorus from the polluted water that is pumped into the system using solar-powered pumps. Clean water is then deposited back into the lake.
The second phase began in May and the initial results indicate that the system can produce a quantity of algae comparable to raceways, the traditional algal farming method. The algae being grown are native to the area which makes it more resistant to attacks from local pathogens and predators. By helping to clean polluted water, Sandia researchers have overcome a major criticism of algae as a biofuel source, specifically that farming algae requires too much water. Additionally, the removal of pollutants, such as nitrogen, phosphorus, and other fertilizer components, is expected to provide a model of remediation for algae blooms.