RFS Uncertainty Chills Advanced Biofuel Funding

Cindy Zimmerman

biologoA new analysis from the Biotechnology Industry Organization (BIO) finds delays in rulemaking for the Renewable Fuel Standard (RFS) have chilled necessary investment in advanced and cellulosic biofuels.

According to the analysis, the industry has experienced an estimated $13.7 billion shortfall in investment over the past two years as the Environmental Protection Agency has delayed setting volume obligations for biofuels under the RFS.

(EPA) was nine months late issuing the 2013 RVOs and is more than 17 months late in issuing the 2014 rule. Further, the agency has made cellulosic biofuel producers wait an average of 29 months (more than two years) for approval of production pathways. Currently, 29 companies have unresolved petitions filed with EPA and they have been waiting on average more than 32 months for resolution. A majority of an estimated $13.7 billion shortfall in investment for cellulosic and new advanced technologies should therefore be attributed to EPA’s delays in issuing timely rules.

Brent Erickson, executive vice president of BIO’s Industrial & Environmental Section, notes that the situation came about just as plants were beginning to reach the commercial stage. “The chill in investment has had the heaviest impact on cellulosic biofuel developers,” said Erickson. “The delays in rulemaking have also undercut the industry’s ability to create new employment opportunities, resulting in the loss of more than 80,000 direct jobs.”

According to BIO, the industry has invested more than $5 billion in first-of-a-kind demonstration and commercial-scale biorefineries around the world. The analysis finds that as of April 2015, there are five commercial cellulosic biorefineries with a combined capacity of more than 50 million gallons within the United States and registered to meet the goals of the RFS, along with several pilot and demonstration plants. Additional commercial biorefineries are under construction.

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