Record biodiesel production in 2013 has industry calling for RFS changes.
THE U.S. biodiesel industry set a new record in 2013 by producing nearly 1.8 billion gal., according to recently released Environmental Protection Agency figures that underscore the industry's case for a revised renewable fuel standard (RFS) proposal this year.
The industry's total production significantly exceeded the 2013 biodiesel requirement under the RFS and was enough to fill the majority of the advanced biofuel requirement. However, the Obama Administration has proposed holding the 2014 RFS volume for biodiesel at 1.28 billion gal. while also sharply cutting the overall advanced biofuel requirement — a proposal that, if finalized, would significantly reduce production.
"The biodiesel industry hit a grand slam in 2013, hitting an average annualized monthly production rate of 2 billion gal. for the last half of the year — double that of (the previous) year's record," said Joe Jobe, chief executive officer of the National Biodiesel Board. "The EPA's volume proposal for 2014 would effectively cut the volumes in half from current production levels. I can't think of a more unacceptable example of a call for full retreat during such an overwhelming victory."
Industry leaders pointed to the new 2013 numbers in again calling on the Administration to increase the biodiesel and advanced biofuel RFS proposals to at least reflect current production rates.
"The success of the biodiesel industry in 2013 proves that the RFS is working today and stimulating the commercial-scale production of advanced biofuel," Jobe said. "It also makes it incredibly frustrating that the Obama Administration is backing away from this progress with its recent RFS proposal.
"If our industry produced 1.8 billion gal. of advanced biofuel in 2013, why is the Administration retreating to 1.28 billion gal. for 2014? We're proving it can be done. What we need is consistent policy, and that is sorely lacking in Washington (D.C.) right now," Jobe said.
Made from a wide range of feedstocks, including recycled cooking oil, soybean oil and animal fats, biodiesel is the first EPA-designated advanced biofuel to reach commercial-scale production nationwide.
The year-end volume was reported on the EPA website under the biomass-based diesel category, which is a subset of the overall advanced biofuel category. The new record was reached with production in nearly every state in the country.
The total biomass-based diesel volume of 1.8 billion gal. was primarily biodiesel but also included renewable diesel, a similar diesel alternative made with the same feedstocks but using a different technology.
"It is incomprehensible that an Administration that has unequivocally supported renewable fuels since day one has suddenly decided to retreat on the first advanced biofuel to reach commercial-scale production nationwide," Jobe said. "It threatens biodiesel businesses across the country and thousands of jobs, and it undercuts the Administration's stated priority of reducing greenhouse gas emissions.
"Perhaps more importantly, it jeopardizes the future of all renewable energy by sending a terrible signal to entrepreneurs and investors that these policies are not stable, even under a President who professes to support them," Jobe explained.
Because some excess 2013 biodiesel production could be "carried over" into 2014 for RFS compliance purposes, the real RFS market this year could be closer to 1 billion gal. for biodiesel — a cut that would shock the industry. News outlets around the country have published stories recently highlighting the harm the EPA proposal would do to local producers.
In addition to the weak RFS proposal, Congress also allowed a key biodiesel tax incentive to lapse on Dec. 31, further disrupting the industry this year.
"Many biodiesel producers have been running at full capacity in recent months," Jobe said. "That's driving down costs and creating tremendous economic activity. Yet, instead of embracing this success, Washington is walking away from it."
According to a recent study, the industry is supporting more than 62,200 jobs nationwide, and nearly 8,000 of those jobs would be threatened by a drop in production back to 1.28 billion gal. Biodiesel reduces greenhouse gas emissions by 57% to 86%, according to EPA.