The Environmental Protection Agency has released its proposed Renewable Fuel Standard (RFS) renewable volume obligations (RVOs) for 2014, 2015 and 2016 and Renewable Fuels Association (RFA) president and CEO Bob Dinneen is disappointed.
In this Ethanol Report, Dinneen talks about why he believes the proposal is a step backward for the RFS and how it places the potential growth in renewable fuels in the hands of the oil companies. Ethanol Report on EPA RFS volume proposal
Presidential candidate Hillary Clinton came out in favor of domestic, renewable energy in an op-ed for the Cedar Rapids Gazette this week.
“I believe the United States can and must be the clean energy super power for the 21st century,” writes Mrs. Clinton. “We can’t afford to cede our leadership in developing and deploying the advanced, clean fuels of the future that will grow our economy, lower our energy bills, reduce pollution, and protect the health of our families and communities. And America’s farmers and rural communities have to be at the heart of this effort.”
Clinton gave a strong endorsement of the Renewable Fuel Standard:
The Renewable Fuel Standard can continue to be a powerful tool to spur the development of advanced biofuels and expand the overall contribution that renewable fuels make to our national fuel supply. But we also can’t ignore significant changes to the energy landscape since the RFS was expanded in 2007. We have to get the RFS back on track in a way that provides investors with the certainty they need, protects consumers, improves access to E15, E85, and biodiesel blends, and effectively drives the development of cellulosic and other advanced biofuels.
The Biofuels Infrastructure Partnership is getting an infusion of up to $100 million according to U.S. Department of Agriculture (USDA) Secretary Tom Vilsack. The funds will be used to build and update infrastructure needed to bring more biofuels to market. The announcement came on the same day that the Environmental Protection Agency (EPA) announced the Renewable Fuel Obligations (RVO) for 2014-2016 under the Renewable Fuel Standard (RFS).
Photo credit: Joanna Schroeder
As part of the program, USDA will provide competitive grants to match funding for state-led efforts to test and evaluate innovative and comprehensive approaches to market higher blends of renewable fuel, such as E15 and E85. States that are able to provide greater than a one-to-one ratio in funding will receive higher consideration.
“American-made, clean energy sources support the environment, reduce our dependence on foreign oil, create jobs and sustain the economy in rural communities across the country. We are fortunate that our farmers are producing record amounts of feedstock for these fuels,” Vilsack said. “However, a combination of factors, including lower commodity prices and reduced demand for feed as the poultry industry recovers from highly pathogenic avian influenza, are creating uncertainty for America’s corn and soybean producers. With this partnership, USDA is helping to ensure the infrastructure is in place for consumers to access more renewable fuels, expand marketing opportunities for farmers, and grow America’s rural economies.”
The new USDA partnership will help support the installation of fuel pumps capable of supplying higher blends of renewable fuel. The goal of the program is to double the number of fuel pumps capable of supplying higher blends of renewable fuel to consumers, such as E15 and E85.
Suntech has announced that it will supply approximately 63 MW of solar panels to 8 separate Gunkul Engineering projects being constructed across Thailand. The projects are expected to be grid connected and operational by the end of 2015.Ethanol industry groups are blasting the EPA proposal for volume obligations under the Renewable Fuel Standard (RFS) for what they see as siding with the oil industry.
“Today’s announcement represents a step backward for the RFS,” says Renewable Fuels Association president Bob Dinneen, noting that the EPA continues to cling to the “blend wall” methodology. “The EPA plan fundamentally places the potential growth in renewable fuels in the hands of the oil companies — empowering the incumbent industry to continue to thwart consumer choice at the pump with no fear of consequence for their bad behavior.”
“EPA is yet again proposing to circumvent the RFS by limiting ethanol use to the amount oil companies are willing to blend with the gasoline they refine and not one gallon more,” said American Coalition for Ethanol executive vice president Brian Jennings. “If EPA is willing to let oil companies disregard Clean Air Act requirements to clean up motor fuel, how does it expect power plants to comply with their Clean Air Act proposal to curb carbon pollution?”
“It is unfortunate that EPA chose to side with the obligated parties who have deliberately refused to live up to their obligation to provide consumers with a choice of fossil fuels or lower cost, higher performing, homegrown renewable energy at the pump,” said Growth Energy CEO Tom Buis.
“Once again, the EPA has chosen to ignore the law by cutting the corn ethanol obligation 3.75 billion gallons from 2014 to 2016. This represents nearly a billion and a half bushels in lost corn demand,” said National Corn Growers Association president Chip Bowling. “The only beneficiary of the EPA’s decision is Big Oil.”
EPA will hold a public hearing on the proposal June 25 in Kansas City, Kansas. The public has until July 27 to comment on the proposal.
The biodiesel industry is relatively pleased with the announcement today from EPA setting volume requirements for biofuels under the Renewable Fuel Standard (RFS).
National Biodiesel Board (NBB) CEO Joe Jobe voiced “measured support” for the proposal while calling for improvements in the final rule.
“It is not perfect, but it will get the U.S. biodiesel industry growing again and put people back to work,” said Jobe. “However, more can be done, and we particularly look forward to working with the administration on strengthening biodiesel volumes for 2016 and 2017 during the comment period in the coming weeks.”
Biodiesel falls under the Biomass-based Diesel category of the RFS, which is a subset of the overall Advanced Biofuels category. The EPA proposal, which is slated to be finalized in November, would gradually raise biodiesel volumes by about 100 million gallons per year to a standard of 1.9 billion gallons in 2017. Because of biodiesel’s higher energy content, this would count as 2.95 billion ethanol equivalent gallons under the RFS. The overall Advanced Biofuel standard would rise to 3.4 billion ethanol equivalent gallons in 2016. NBB had requested more aggressive growth to a biodiesel standard of 2.7 billion gallons by 2017, along with additional growth in the overall Advanced Biofuel category.
Beating the announced deadline of June 1, the Environmental Protection Agency (EPA) today proposed the volume requirements under the RFS program for 2014, 2015, and 2016 for cellulosic biofuel, biomass-based diesel, advanced biofuel, and total renewable fuel. EPA is also proposing the volume requirement for biomass-based diesel for 2017.
EPA is proposing to set the renewable fuel standards for 2014 at the levels that were actually produced and used as transportation fuel, heating oil or jet fuel in the contiguous U.S. and Hawaii. For 2015 and 2016, EPA is proposing ambitious increases in both advanced biofuel and total renewable fuel in comparison to 2014 levels. This proposed rulemaking also provides an evaluation of the expected volumes of cellulosic biofuel for 2015 and 2016, and proposes annual increases in the required volume of biomass-based diesel for 2015, 2016, and 2017.
Announcing the proposal today was Janet McCabe, EPA Acting Assistant Administrator for the Office of Air and Radiation. EPA Announces RFS RVO proposal
McCabe took a number of questions from the media on the proposal. EPA RVO proposal media question and answer
A new study shows how E85 has been a success in California. Published by Propel Fuels, the white paper titled, “E85: A California Success Story White Paper,” and associated website illustrate the state’s emergence as the national leader in the use of sustainable E85 Flex Fuel.
Key research findings include:
● California has the highest rate of E85 growth of any state in the nation. E85 use has expanded 600% in California since 2009, while gasoline demand has decreased.
● E85 use has significant positive impacts on air quality, greenhouse gas (GHG) reductions and petroleum reductions; providing air quality benefits in severe non-attainment areas by contributing 18-53% reduction in NOx as well as a 32% reduction in GHG emissions.
● E85 use has specifically benefited CalEPA designated Disadvantaged Communities.
● E85 is California’s value fuel, with 92% of users saying it is the same or better value than gasoline.
● California’s 1 million Flex Fuel vehicles can displace 600 million gallons of petroleum gasoline with E85.
● California’s retail E85 volume per location exceeds the national average by 300%.
● As a result of its policies, California is home to the lowest carbon ethanol in the country.
“Thanks to smart public policy and a strong value proposition for consumers, California’s E85 use has become a success story, and a road map for our nation for implementing low carbon fuels,” said Rob Elam, CEO of Propel Fuels. “This research conclusively demonstrates that E85 is a successful, sustainable, cost-effective fuel that consumers are choosing when they have retail access.”
California boasts 1 million Flex Fuel vehicles (FFV’s) that can use E85 interchangeably with conventional gasoline with no modification.
Consumption of renewable energy sources hit the highest levels in 80 years. This report from the U.S. Energy Information Administration (EIA) says renewables accounted for 9.8 percent of total domestic energy consumption in 2014, the highest renewable energy share since the 1930s, when wood was a much larger contributor to the domestic energy supply.
Renewable energy use grew an average of 5% per year over 2001-2014 from its most recent low in 2001. The increase over the past 14 years was in part because of growing use of wind, solar, and biofuels. Wind energy grew from 70 trillion Btu in 2001 to more than 1,700 trillion Btu in 2014. During the same period, solar energy (solar thermal and photovoltaic) grew from 64 trillion Btu to 427 trillion Btu, and the use of biomass for the production of biofuels grew from 253 trillion Btu to 2,068 trillion Btu. Hydroelectricity was the largest source of renewable energy in 2014, but hydro consumption has decreased from higher levels in the mid-to-late 1990s. Wood remained the second-largest renewable energy source, with recent growth driven in part by demand for wood pellets.
In 2014, slightly more than half of all renewable energy was used to generate electricity. Within the electric power sector, renewable energy accounted for 13% of energy consumed, higher than its consumption share in any other sector.
The industrial sector used 24% of the nation’s renewable energy in 2014. Nearly all of that renewable energy was biomass, which included wood, waste, and biofuels used in manufacturing processes as well as in the production of heat and power. The production of biofuels results in energy losses and co-products, which are also included in industrial consumption of renewables.
EIA says more wood for home heating and more solar panel systems are the main contributors to increasing renewable energy consumption in residential buildings and, to a lesser extent, in commercial buildings.
How will the electricity energy mix change with the implementation of the Clean Power Plan? This question was reviewed in the latest Energy Information Administration’s (EIA) Today in Energy. Using the Annual Energy Outlook 2015 (AEO2015) as the baseline, the main compliance strategy to lower emissions rates as the proposed rule comes into effect is to increase natural gas-fired generation to displace and ultimately surpass coal-fired generation. Later, as more wind and solar capacity are added, renewable generation also surpasses coal-fired generation.
The analysis finds that changes in the fuel mix play out in different ways across the country, reflecting regional variation in the economics of increases in natural gas generation and renewable capacity. Key determinants include baseline combined-cycle utilization rates and the potential for renewable generation in areas without renewable portfolio standards.
EIA’s analysis also modeled the proposed rule using the High Oil and Gas Resource (HOGR) and High Economic Growth cases from AEO2015 as alternative baselines. The HOGR case reflects a scenario in which more abundant domestic natural gas resources and better technology enhance natural gas supplies, keeping projected annual average spot natural gas prices below $4.50 per million Btu through 2040.
EIA also looked at other cases including several sensitivity cases encompassing different interpretations or implementations of the proposed rule as well as a scenario in which further emissions reductions are required beyond 2030, all of which use the AEO2015 Reference case as their baseline. In addition a case was considered in which new nuclear units not already under construction were brought online.
Ultimately, in all cases renewable energy became a bigger player in the energy mix but whether it played a starring or supporting role was dependent on the level of traditional fuel sources that remained in use.
