The makers of biodiesel, America’s favorite advanced biofuel, are gathering this week in San Diego for the leading annual gathering on the future of diesel-side renewable fuels, and how the quest for energy security, domestic jobs and reduced greenhouse gas emissions is coming along.
As the National Biodiesel Conference opened, NBB’s new CEO Donnell Rehagen focused on firing up the base with a positive “yes, you can” message noting that “we have to keep stoking our dreams” amidst numerous references to “uncertain times.” References to “underdog made good” stories of the likes of J.K. Rowling and William Shatner abounded.
Uncertain the future may be, but the immediate past was no bed of thorns for biodiesel and renewable diesel. NBB policy guru Anne Steckel said that the industry produced 2.6B gallons of renewable diesel and biodiesel in 2016, and Rehagen touted $8B in economic value but said that if the industry reached 2.5B gallons of biodiesel, it could generate as much as $14B in total economic value.
On surveying the incoming Trump Administration and fears of a rollback on renewable fuels and clean energy, Steckel said “we’ve been here before and prevailed. But the oil industry continues to mount an aggressive campaign attacking the RFS. While most of that attack is focused on ethanol, every gallon less means more money in the oil industry’s pocket. And money is what this fight is all about.”
The 3 Don’t Forget to Mentions
Key messages for the industry to communicate in 2017? Biodiesel’s advocates will be focused on:
1. Jobs and wage creation
2. The producer tax credit as a powerful domestic economic stimulant
3. Biodiesel as key to diversified fuel options for the US.
General Motors: We’re bullish on diesel
Meanwhile, GM’s John Schwegman took the stage and said that General Motors is “very optimistic on the diesel market,” noting that GM alone has more than 2 million diesel vehicles on the road today in the US and is making all its existing and future diesel vehicles B20 compliant.
General Motors is taking bold steps to expand the U.S. diesel vehicle market beyond its traditional stronghold in full-size pickups, and providing more options than ever before for customers to reap the additional benefits of fueling up with B20 biodiesel blends, America’s Advanced Biofuel. With eight new diesel vehicle options hitting the roadways in 2017 – 2018, General Motors now offers a full line-up of twenty different diesel models, from passenger cars, to pickups and SUVs, to commercial vans and low cab forward trucks – all of which are approved for use with B20.
John Schwegman, Director of Commercial Product and Medium Duty Product for General Motors, delivered the welcome news to an enthusiastic crowd at the National Biodiesel Conference & Expo today in San Diego.
“Diesel propulsion deserves wider consideration by fleet managers across the country,” Schwegman said. “With biodiesel production and retail distribution expanding, and so many proven benefits, we believe more fleets will embrace the technology as part of their sustainability plans. If our diesel customers fueled exclusively with biodiesel, we estimate that consumption of petroleum-based fuels would be reduced by hundreds of million gallons annually.”
GM Fleet’s B20 Capable Options Include:
- Chevrolet Express full-size vans (Cargo, Passenger, Cutaway)
- Chevrolet Low Cab Forward commercial truck
- Chevrolet Colorado mid-size pickup
- Chevrolet Silverado (2500HD, 3500HD, Chassis Cab) pickups
- Chevrolet Equinox crossover vehicle
- Chevrolet Cruze (Sedan, Hatchback) passenger cars
- GMC Savana (Cargo, Passenger, Cutaway) full-size vans
- GMC Sierra (2500HD, 3500HD, Chassis Cab) pickups
- GMC Canyon mid-size pickup
- GMC Terrain crossover vehicle
- In 2018, Chevrolet will add a fifth diesel-powered truck line: a new Class 4/5 conventional cab truck being developed jointly with Navistar.
Biodiesel’s Rock Stars pick up the hardware
Following the ritual thanking of supporters and encouraging of believers, which featured just about everything except baptism by immersion, the NBB gave its Energy Leadership Award to Iowa Governor Terry Branstad, its Eye on Biodiesel Influencer Award to Greater Washington Region Clean Cities Coalition executive director Ron Flowers.
The Climate Leadership Award went to NYC councilman Costas Constantinides, who gave a rousing address, in which he said, “When i think about climate change. asthma rates and how we were affected by Hurricane Sandy, I know that biodiesel is right for our community, and when we see naysayers, we just have to fight back with facts.”
The outlook for biodiesel
In our report here, INFORMA’s Scott Richman looked at the EPA’s RFS rule-making, and the volumes, issues and opportunities for ethanol and biodiesel in, and said:
“Biodiesel is far more expensive than petroleum, and the RIN made up about half,” Richman observed. “So, biodiesel is unlike ethanol, they really need the RFS to work for them. And EPA has helped them. The minimum was 1 billion gallons, but EPA has set a standard rising to 2 billion in 2017. Biodiesel, Richman said, is of a price puzzle because Argentine exports are coming; they have qualified for D4 biomass-based diesel RINs and domestic producers are going to have to match them on price.
Biodiesel’s R&D highlights
Exxon, REG partner on cellulosic biodiesel quest
In January, we reported that ExxonMobil and Renewable Energy Group have agreed to jointly study the production of biodiesel by fermenting renewable cellulosic sugars from sources such as agricultural waste.
REG has developed a patented technology that uses microbes to convert sugars to biodiesel in a one-step fermentation process similar to ethanol manufacturing. The ExxonMobil and REG Life Sciences research will focus on using sugars from non-food sources. Terms were not disclosed.
Projects of Note
Duonix Beatrice reaches commercial-scale
In September, we reported on what we described as the “most important technological advance in biodiesel in recent years” – the first commercial-scale application of Benefuel’s innovative ENSEL technology. It reached commercial-scale in Eastern Nebraska, with the startup of the Duonix Beatrice biodiesel plant, which is and . ENSEL technology is capable of converting a range of lower cost feedstocks such as recycled cooking oil and distillers corn oil into high-quality biodiesel.
China’s Kaidi to invest in massive advanced biofuels project
Last month, we reported that China’s Kaidi had agreed to go ahead with the EUR1 billion investment in a biodiesel plant in the northern part of the country, with a groundbreaking set for sometime next year. The company is in negotiations with potential investors to ensure that the financial backing is in place before moving forward. Last month’s move by the Finnish government to continue supporting biofuels and set blending mandates through 2030 helped to seal the decision to invest.
France advances in effort to build cooking oil biodiesel project
In November, we reported that the European Commission had awarded nearly EUR1.5 million from a total EUR2.44 million project led by a French UCO biodiesel company to Validate an eco-designed, compact and flexible demonstrator in order to produce competitively-priced advanced biofuels derived from UCO and bioethanol that will eventually provide French local authorities’ transport fleets with locally-produced biofuel. The project will include construction of an eco-designed, compact and flexible 2 000 L/day demonstrator allowing the processing of UCOs with up to 50% acidity for biofuel production, eventually producing 245,000 liters of fuel throughout the project.
Brazil’s ANP gives Caramuru Alimentos the OK for new $7.5 million biodiesel plant
Earlier this month, we reported that Caramuru Alimentos, one of the largest domestic grain processors of, received authorization from the National Petroleum, Natural Gas and Biofuels Agency (ANP) to build its biodiesel plant in Sorriso, Mato Grosso. The authorization was published on Friday in the Federal Official Gazette. The plant, which will be built in the industrial complex that Caramuru has in Sorriso, will have the capacity to produce 285,000 liters per day, or about 104 million liters per year. The construction of the unit will cost $7.5 million, financed by the Constitutional Fund for the Center of the East (FCO). This will be Caramuru’s third biodiesel plant in the country. The company already operates two units in Goiás which, together, have the capacity to process 450 million liters per year.
Deployment Highlights
India deploys biodiesel buses in Karnataka state
Last month, we relayed a report from the India Times that the Karnataka State Road Transport Corporation (KSRTC) has deployed 25 Scania buses that run completely on biodiesel, in following Prime Minister Narendra Modi’s ‘Make in India’ project. “The state road transport organization began trials last year with 10 buses run on 20% biofuel and 80 per cent petrodiesel,” said The Times. “The results were very encouraging and hence they decided to try and run a bus completely on biodiesel for a few months ago.” Overall, the target is for a 70 percent reduction in emissions with the move to Indian-based biodiesel.
Stats to Remember
Iowa biodiesel production sets record in 2016
In Iowa, the state’s 2016 biodiesel production reached a recording-breaking total of 297 million gallons, surpassing 2015’s total 242 million gallons by 55 million gallons. This 23 percent increase is largely attributed to policy certainty at the federal level during 2016, including the biodiesel tax incentive and Renewable Fuel Standard. State level policies targeting higher biodiesel blends, such as Iowa’s B11 excise tax differential, also helped drive demand. Compared to 2015, soybean oil remained the largest feedstock for Iowa biodiesel production – holding steady at 66 percent.
Spain’s biodiesel volume surges
Last week, we reported that biodiesel blending fell percentage-wise in November to 4.4% but increased volume-wise over October to 81,160 metric tons while ethanol blending fell to 5.69% from 6.35% while volume by a little more than 1,000 tons to 20,887 tons. Biodiesel blending reached 884,742 tons for the year through November for an average of 4.3% while ethanol blending reached 225,716 tons, representing just 5.18% compared to 6.09% the year prior. That drop in ethanol blending cut consumption by about 12% on the year.
Indonesian palm oil biodiesel exports fall to 25.7 million tons in 2016
Also last week, we reported that palm oil biodiesel exports fell by half a million metric tons in 2016 from the previous year to 25.7 million tons, down from 26.2 million tons in 2015. Ongoing drought conditions impacted production, lowering the available supply for exports. Duties levied on palm oil exports finance subsidies to oil marketing companies to ensure high levels of domestic biodiesel blending despite low fossil fuel prices. Domestic consumption increased slightly to 2.7 million tons in 2016 from 2.5 million tons the year before.
Policy Advances and Reverses
EU’s anti-dumping duties on Argentine biodiesel nixed by WTO
In Switzerland, following the European Court’s ruling a few weeks back that the EU’s anti-dumping duties on Argentine and Indonesian biodiesel were not appropriate, the World Trade Organization has made its decision along the same lines. The WTO had voted mostly in favor of Argentina in March but the EU appealed the decision. Thursday’s decision on the appeal definitively rules in favor of Argentina but it is up to the European Commission to drop the anti-dumping duties permanently.
Argentina extends excise duty credits to support biodiesel
Earlier this month, we reported that the Argentine government published a rule just before the new year to extend excise duty waivers for biodiesel used to produce electricity and taxes levied on biodiesel production in an effort to continue to support the industry that has yet to recover its export markets. Following on from the success achieved in 2016 to boost the amount of renewables in the energy matrix rather than allowing fossil fuels to fill the demand gap, the extensions are now in place through December 31, 2017.