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California Biodiesel Alliance News

California's Biodiesel Industry Trade Association  


March 2017    

In This Issue

We are happy to begin by congratulating Crimson Renewable Energy and New Leaf Biofuel on securing CEC grant funding to expand the scope of their California production operations!  
This month we bring you positive news about key events, developments, and people, including some very important farmers (and a shout-out from NBB to local pioneer Kent Bullard). Policy updates include info on the new state UST rulemaking, our industry's technical comments on the LCFS mandatory verification rulemaking, and much more (see the policy section).
Twin challenges to LCFS advance in California courts and biodiesel is targeted. We include an article on the oral arguments presented on March 23rd in the POET v. CARB lawsuit.
In federal news, the 2017 RFS RVOs kicked in on March 21st, having been delayed but otherwise unscathed by White House actions. Concern about imports skyrocketing to almost 1 billion gallons in 2016 abound, and toward understanding the dynamics of that issue we reprint an article by Ron Kotrba.

California Fights Back Against Federal Actions: To stay abreast of state efforts to preserve key policies and bring other jurisdictions together to fight climate change, follow the press releases of CA Senator Kevin de Leon and Governor Brown.
Note: You are receiving this complete version of the newsletter because your membership is current or you are a Partner Sponsor (or state agency staffer who has signed up to receive it). Our  Members Only  webpage is available to you: Password 2006, the year CBA was founded.
Back Issues of this newsletter are available in the Archives on our Members Only webpage. 
CBA's Sixth Annual Biodiesel Conference Covers It All
Highlights Thriving California Biodiesel Market
    All New Conf Logo
Jennifer Case, Chair, California Biodiesel Alliance (CBA), ended her opening address at the sixth annual California Biodiesel Conference on March 1, 2017 in Sacramento with one simple message: the world of biodiesel is trending up! While not shying away from challenges to the state's industry, Case focused on the good news that the state has survived recent threats to its Low Carbon Fuel Standard (LCFS) and has seen credit values rise as a result. She said it's time to celebrate the opportunity for soy and biodiesel imported from other states to help meet current LCFS demand and the demand that will be created by aggressive targets beyond 2020 under SB 32, which calls for an overall economy-wide GHG reduction of 40% by 2030 compared to 1990 levels!
Moderated by Curtis Wright, Biotane Fuels Division Manager, Imperial Western Products, the first panel focused on biodiesel's famously low carbon intensity. Anil Prabhu, Manager, Fuels Evaluation Section, ARB, discussed how biodiesel feedstocks determine CI scores under LCFS' lifecycle analysis and the tools used to determine the "direct" and "indirect" effects on those scores. He mentioned LCFS considerations for biodiesel in 2019, including these issues: updating CA-GREET; seeking feedback on transport distance for feedstock sourcing; facility-specific rendering energy; and mandatory third-party verification of producers' CIs, especially for UCO.
Don O'Connor, (S&T)2 Consultants Inc., presented a detailed look at the universe of factors that determine the CI of biodiesel. He cited a need for better information on transportation distances for UCO and listed some opportunities for lowering CI scores, including renewable natural gas (the biggest opportunity), renewable methanol, and potentially using distillation bottoms for fuel.
With a focus on ARB's new rulemaking, Shashi Menon, Managing Partner, EcoEngineers, praised the LCFS and called the proposed verification program a step in the right direction. He offered some of his thoughts about how to reduce risk in the credit marketplace and how to regulate, monitor, and help verification bodies - all toward the goal of letting the clean fuels sector focus on production.
Don Scott, Director of Sustainability, NBB, presented information about recent improvements in LUC modeling that are showing decreases in the iLUC penalties of most biofuels, including soy biodiesel. Stating that globally, we are feeding more people and using less land to do so, he ended by calling it a convenient truth that
"when we grow protein to feed the world, we get more fat than we can eat. This is a natural and abundant form of stored solar energy."
Key California biofuels policies were covered in the next panel moderated by Russ Teall, President and Founder, Biodico Sustainable Biorefineries. Floyd Vergara, Chief, Industrial Strategies Division, ARB, presented a broad overview of the state's complex suite of regulations, directives, and legislation designed to meet its climate targets, including the Scoping Plan, the LCFS, and the Alternative Diesel Fuel Regulation ( ADF), which currently affects only biodiesel. The ADF regulation requires reporting by producers, importers, and blenders beginning 1.1.2016 and will require new reporting on 1.1.2018 to include the method of NOx control. He said that LCFS and ADF provide a "durable framework" for lowering the CI of transportation fuels to 2020 and beyond and cited biomass-based diesel fuels' significant environmental and human health benefits, specifically the importance of PM reductions in environmental justice (EJ) communities.
Tim Olson, Energy Resources Manager, California Energy Commission, pointed out potential competition for funding from his agency facing biodiesel from refinery co-processing, biomethane, low-NOx natural gas and renewable diesel. Citing the GHG emissions reduction potential of commercial-scale agency projects, he presented a scenario of ten alternative diesel projects using waste oils with an average 81% GHG reduction and total annual capacity increase of 74.9 million DGE per year.
CBA's lobbyist Louie Brown discussed the group's targeted legislative and regulatory work, including a focus on the priority effort to secure Cap and Trade auction proceeds for instate biofuels production incentives. Allan Morrison, Senior Environment Scientist Fuels and Lubricants Laboratory, Division of Measurement Standards (DMS), California Department of Food and Agriculture (CDFA), covered biodiesel-related programs highlighting Inedible Kitchen Grease Program (IKG) updates and biodiesel dispenser labeling requirements. He said he would work with the state industry to address labeling challenges potentially posed beginning 1.1.2018 by the ADF regulation's seasonal limits.
Moderated by Joe Gershen, President, Encore BIoRenewables, the panel Thriving in the California Biodiesel Market: Risk Management Strategies brought three experts with deep experience in the full-time, complex job of managing risk with fuels and other commodities, which requires balancing science, math, intuition, creativity and a bit of luck. Billy Burns, Energy Risk Management Consultant, INTL FCStone Inc.; Paul Oesterreich, Sales Executive, Renewables, World Fuel Services; and David Dunn, Compliance and Renewables Manager, Idemitsu Apollo, discussed the several additional levels of complexity of the California biodiesel industry, which involves physical product, RINs, LCFS credits, and uncertainty about whether the federal tax credit will be reinstated. Each shared their pragmatic approach to how to manage risk and thrive in the Golden State.
Keynote speaker, Dean Florez, a California Air Resources Board member, gave a decidedly upbeat address that touched on the benefits of biodiesel, including GHG and PM reductions, and the need for higher blends. Every bit the biodiesel champion, he was optimistic about biodiesel's role in helping the state reach its climate goals and encouraged the state's industry to continue to work closely with his agency and to reach out to the EJ community on the state's Scoping Plan.
Donnell Rehagen, CEO, NBB, presented a comprehensive overview of the federal biodiesel industry. Citing the NBB's "10 x 22 Vision" for biodiesel to comprise 10 percent of diesel fuel demand by 2022, he updated attendees on the Renewable Fuel Standard (RFS) and the federal tax credit, the market drivers behind that goal. Among the range of opportunities and challenges for biodiesel at the different regional levels, he pointed out the staggering potential of California's LCFS to catapult biodiesel and renewable diesel demand from several hundred million gallons today to 1.6 billion gallons by 2030.
Tyson Keever, President and CEO, SeQuential, both moderated and presented on the panel SB 32: A New Era for California Markets and Beyond. Passionate about his state's need to address climate change, he focused on Oregon's Clean Fuel Program. The program, which was fully implemented beginning in 2016 and calls for a 10% reduction of average CI in 10 years, still needs to resolve issues related to cost containment, rules for small vs. large importers, retroactive credit generation, and more.
Ian Thomson, President, Advanced Biofuels Canada, detailed how u nder climate action and clean tech growth plans, Canada's federal government, and several provincial governments, are developing renewable and clean fuel standards. Regulations promoting biofuels are being updated and new ones are being proposed with industry consultation underway. This is occurring in Quebec, Ontario, Alberta, and British Columbia, the provinces where 85% of Canada's fuels are sold, offering significant growth opportunity for biofuels.
Shelby Neal, Director of State Governmental Affairs, NBB, in presenting scenarios for meeting the proposed 18-25% CI reductions by 2030 under LCFS as part of compliance with SB 32, discussed his view of a more realistic scenario than that put forward in the state's Biofuel Supply Module, which relies heavily on EVs, biomethane, and hydrogen adoption. His bottom line: California should not limit biodiesel to 20% or play favorites between biodiesel and renewable diesel, because the state is going to need all of those fuels it can get!
The panel The Best Biodiesel Writers in Open Dialogue wrapped up the day. The audience was treated to a discussion with Ron Kotrba, Editor, Biodiesel Magazine; Tina Caparella, Editor/Publisher, Render Magazine; and Bob Lane, Vegetable Oil, Biodiesel, and Grain Editor, The Jacobsen. In response to questions from moderator Celia DuBose, Executive Director, CBA, there was general agreement about support for policies favoring domestic fuel and a producers tax credit, as well as concern about biodiesel policies under the Trump administration. The panelists, who read a huge amount of material to stay current in the field, cited the value of learning about both the very big picture of global trends and the nitty gritty of daily life in the industry from personal discussions with industry members. 
As a very fitting end to the day, and to answer the question about what our industry can do better, the writers enthusiastically urged attendees to tell their stories and to include details about the jobs the biodiesel industry is creating, the vendors companies are working with, the technology being used - all of it!
CBA wishes to thank the following for their generous conference sponsorship: the NBB and REG (Gold); Crimson Renewable Energy (Silver); and Biodico, Chemol Company, and the Sustainable Biodiesel Alliance (Bronze). CBA recognizes, with special thanks, its Partner Sponsors: the NBB (Gold); Argus, Baker Commodities, and EcoEngineers (Silver); and ACT, Evonik, and The Jacobsen (Bronze). 

State Water Resources Control Board Begins Rulemaking
 to Reflect 2015 Federal UST Regulation
Cal/EPa Building
The CalEPA Building houses the State Water Resources Control Board  
In 2015, the US EPA finalized a new federal underground storage tank (UST) regulation designed to strengthen regulations on the operation and maintenance of UST systems.

Now, the State Water Resources Control Board is in the beginning stages of a rulemaking, which they plan to implement on January 1, 2018, to reflect and comply with that regulation. Water Board staff held two workshops in Sacramento and LA this month and are seeking feedback on the proposed regulation. Meeting handouts with draft legal language are being made available on
their website  under Hot Topics.
There are proposed changes that all UST owner / operators will need to pay attention to, including visual inspections at least once every 30 days, new recordkeeping requirements, and employee training and certification. However, according to Water Board staff, the proposed regulation won't change the situation much for biodiesel - except that overfill prevention equipment, spill containment, and maybe pumping equipment will need approvals (which can come from an independent testing organization, engineering approvals, or manufacturer statements of compatibility). Under dispenser containment has already been subject to engineering approvals.
Here are a few key features of the proposed regulation affecting biodiesel:
Notifications : A switch in fuels to a blend above B20 will require the owner to notify the CUPA 30 days prior. This has technically been the rule since the federal regulation took effect in 2015, but it has not been enforced.
Approvals : The current requirement of manufacturer approvals for blends above B5 will remain. Owner/operators must demonstrate compatibility for as long as the substance is stored. 
Repairs : Materials used in repairs and upgrades must be compatible for all USTs. 

UL listing for diesel for year of component required:
The Water Board will post these on their site.
Water Board staff agreed on the need to provide a simple guide on steps to converting fuels on their website and said they will also be doing a new round of outreach to secure more statements of compatibility from manufacturers as part of this rulemaking. 
Our industry is engaging with Water Board staff toward the goal of the best possible regulation for biodiesel.  We are also working closely with our industry partner CIOMA to develop solutions to assist those entities with installed equipment made by out-of-business companies.

California Appellate Court Hears Oral arguments on LCFS in POET Case 
The 5th District Court of Appeals heard oral arguments in the case of POET v. ARB on March 23rd, 2017. The attorneys for POET argued that the California Air Resources Board (ARB) acted in bad faith by not completely addressing the CEQA violations as directed by the Court and are seeking a suspension of the LCFS to 2013 levels and a complete severance of biodiesel from the regulation.  
The Attorney General's office, representing ARB, argued that ARB did act in good faith by adopting the Alternative Diesel Fuel regulation and disclosing through numerous public hearings the NOx issues related to biodiesel. The Attorney General argued POET's remedy would harm the biodiesel industry and others who are not to blame for the unintended mistakes of the ARB.  She also argued POET's remedy would have negative impacts on the environment. The Attorney General requested the Court to request ARB to address the needed corrections in a timely fashion with no changes to the LCFS. In the alternative, the Attorney General argued that ARB could suspend LCFS credits for biodiesel for the remainder of 2017 and leave the other elements of the LCFS intact, giving the ARB enough time to address the remaining CEQA violations. 
The case is now in the hands of the Court, which should render a decision in the next 90 days.
National Biodiesel Board CEO Donnell Rehagen had this to say, "The California Air Resources Board has worked hard over the past several years to create a program that is now successfully bringing cleaner fuels into the marketplace. Biodiesel is a clean, American-made fuel that has dramatic emissions benefits. Under the Low Carbon Fuel Standard, credits generated from biodiesel comprise about a quarter of overall program compliance. Unfortunately, this lawsuit appears to be far more about market share for specific companies than clean air for Californians."

U.S. Farmers Set Sights  on Biodiesel  and  'Zero Net Energy Farm' 
in California  
ZNEF Video Debuts at ZeroNetEnergyFarms.com
NBB Farmer Visits 2017
Midwest and CA farmers meet with CDFA Sec. Ross & CA Agriculture Commissioners
Photo Credit: Joe Murphy, Iowa Soybean Association
Fresno, Ventura and Tulare Counties, Calif. - March 17, 2017 - Farmers from the Midwest were in California for a tour organized by Tom Verry of the National Biodiesel Board with assistance from Celia DuBose, Ryan Lamberg and Russ Teall. 
During the six-day tour they visited Biodico's facilities on the Naval Base in Port Hueneme and the San Joaquin Valley.  The facilities included biodiesel production and the first-of-its-kind Zero Net Energy Farm, or "ZNEF," an energy self-sufficient farm using on-site renewable resources, including solar, wind and biomass. 
The group also visited the Farm of the Future at West Hills Community College, attended presentations at the Westside Research and Extension Center, and met with Karen Ross, Secretary of the California Department of Food and Agriculture, as well as the members of the California Agricultural Commission.
Nearly a dozen soybean farmers from Iowa, Minnesota, and Nebraska were on the tour.  Over $100 million of Soybean Check-off Funds have supported the biodiesel industry in the United States since the inception of the National Biodiesel Board in 1992.  Celia DuBose, Executive Director of the California Biodiesel Alliance, accompanied the visiting Midwest farmers during the first part of their tour.  "We are grateful to the Iowa, Minnesota, and Nebraska soybean farmers for supporting our industry.  This tour was a good chance to express our thanks to the soy association members from those states and to establish a direct relationship."
During the group's visit of Biodico's facility at Naval Base Ventura County, they saw the Navy's laboratories and project bays before a sit-down discussion with the Navy personnel assigned to the Biodico project.  The group stayed in Santa Barbara and the next morning traveled to Biodico's facility in the San Joaquin Valley by way of San Simeon and a view of the elephant seal colony near there. 
Tom Verry of the National Biodiesel Board organized the trip on behalf of the farmers.  "This was a great opportunity for Midwest farmers to meet California farmers and talk about their common interests in biodiesel and agriculture.  The tour helped deepen their mutual understanding of biodiesel's benefits to the farming communities in the Midwest and California.  This is the beginning of a very good working relationship." 
The final leg of the tour was a visit to the largest agricultural show in the world, World Ag Expo, in Tulare.  During the show the farmers attended a meeting of the California Agriculture Commission and got a chance to meet with CDFA Secretary Ross and the Commissioners.  Russ Teall introduced the farmers and premiered the new ZNEF video.

The group departed the next day from Fresno with a much better understanding of California biodiesel and renewable energy, with plans to continue the relationships that were established during the trip.
(The Crop Science Society of America)
Camelina, Canola Show Promise as Cool-Season Crops  

February 26, 2017
When deciding what crops to grow during a season, growers look at several factors. Do the crops have a good yield in their area? Does the area currently have the resources-usually water-to grow that crop? Will the crop give a return on the investment? And, what are the future effects that growing that crop might have on the grower's fields?
In California, growers usually choose warm-season crops: ones that grow from March to October. But extension agronomist Stephen Kaffka and his team at UC Davis, including project scientist Nic George, explored growing cool-season crops in the same areas. These are grown from October to June.
Why? "Warm-season crops require a lot of irrigation water," Kaffka said. "They tend to be high-value but water-demanding. Cool-season crops have three advantages: the cooler temperatures allow plants to grow without losing as much water through transpiration (like humans' sweat) as crops that grow during hot weather. There is also less evaporation of moisture from the soil. Lastly, the cool season is when California, in particular, gets most of its rainfall-so cool-season crops benefit from this direct source of water."
Kaffka's team looked at growing canola and camelina. Both are cool-season crops that produce oilseeds. These are seeds that are harvested and processed into oils. Canola and camelina also provide oilseed meal byproducts used for livestock feed. Both crops can be used for biofuels.

There is a market demand for cool-season oilseed crops if U.S. growers used them in their crop rotations. "Worldwide, canola and camelina have been used to diversify cereal-based agricultural systems," the researchers state. "At present, the demand for these products in the U.S. is considerably larger than domestic production."
Using oilseed crops instead of wheat can provide several advantages. "They can provide a disease break when problems arise in wheat and other small grains," said Kaffka's research team. "Growing a broadleaf crop where cereals are produced can provide growers with a greater flexibility in weed control options, especially if grassy weeds have become a problem."

With all these benefits, why don't growers just make the choice to grow canola or camelina?

The choice about which crop to grow can be complicated, especially in California where many crops are possible. And growers need to have a high degree of confidence that their investment in a crop will provide a good yield, with enough profit to make the crop competitive with other crop choices they have available.
There are many new varieties of canola and camelina. Canola varieties vary with respect to length of growing season, and tolerance or need for winter chilling. Most camelina varieties are new to cultivation in the U.S. Growers need recommendations from researchers about the type of variety to grow, the ideal times to plant and other factors.
Why did Kaffka's team decide to research oilseed crops? "California's climate is similar to southern Australia, where cool-season crops are grown primarily on natural rainfall in winter," Kaffka and George said. "That region sustains an extensive and successful canola industry. It suggests the agronomic methods and varieties developed for canola in southern Australia could be adopted in California."
One factor in the success of canola for southern Australia has been the development of varieties that grow well in that area. Canola varieties developed for Australia have a shorter growing season than most commercially available spring-type canola varieties grown in the rest of North America. They flower and set seed before summer drought and heat stress, which can suppress yields in longer-season varieties. However, canola can become unreliable in low or more erratic rainfall conditions, according to Kaffka.
Over the course of three growing seasons, the UC Davis team planted more than 40 varieties of canola and more than 60 types of camelina at multiple locations throughout the state. The varieties had a diversity of genetic backgrounds and included both commercial and experimental material. The researchers also carefully recorded variables about the fields and seasonal growing conditions, like the physical and chemical properties of the soil, the amount of rainfall that year and how much irrigation was used.
Kaffka's research team showed canola was a clear winner for growing in California. "Canola achieved high yields and seed oil content," Kaffka said. "Using short- to mid-season varieties, grown in winter, could help canola become an economically viable crop in California."

The results for camelina were not as clear. Its yield and seed oil content were lower and more variable than canola. However, it "displayed greater cold and drought tolerance, so the possibility of camelina being viable for particular niches in California should be investigated further," Kaffka said.
Kaffka's team also recommends that further research evaluate more varieties of both crops. Looking at more short-season spring varieties could find even better varieties to recommend to growers. "Agronomic questions that still need research include crop water use, and appropriate irrigation management," stated the researchers. "We also need research on the effect of diverse planting dates on yield, especially as it relates to soil moisture and temperature."

more  about Kaffka's research in Crop Science. This research was supported by The University of California's Division of Agriculture and Natural Resources and the California Department of Food and Agriculture.
(The National Biodiesel Board)
NBB Highlights 5 Individuals' Stories for National Biodiesel Day
March 16, 2017
Rudolf Diesel couldn't have imagined how far his vision would have come by 2017. In the U.S., nearly 3 billion gallons of clean, renewable fuel replacing its petroleum counterpart. A thriving and growing diesel vehicle market. And 64,000 jobs supported by biodiesel, many the highest paying jobs in the area.
Diesel, who invented the engine that bears his name, ran early models on peanut oil, and was an ardent believer in vegetable oil-based fuel. That's why the biodiesel industry honors Diesel by making his birthday, March 18, National Biodiesel Day.
"For National Biodiesel Day, we're highlighting the people who make this industry great," said Donnell Rehagen, National Biodiesel Board CEO. "American biodiesel has infused jobs and prosperity in communities throughout the nation. Rudolph Diesel would be proud."

Here are just five of the impressive stories from the manufacturing sector of America's advanced biofuel:
1. Lead Technician, Hero BX. Jim Wilwohl serves as a shift foreman, overseeing a four-man crew at biodiesel producer Hero BX in Erie, Pennsylvania. With a capacity of more than 45 MMgy, the plant employs about 50 people. Born and raised in Erie, Wilwohl said the plant has some of the best manufacturing jobs in the area. "I like that my job is part of a green industry," Wilwohl said. "It's nice to work in a modern facility, and we have what I consider great pay, benefits and profit sharing."
2. Owner, Emergent Green Energy. Matthew Jaeger grew up on a Kansas farm, and his brother Luke's vision of producing fuel for their equipment spurred the beginning of EGE Biodiesel. Based in Minneola, Kansas, EGE is a family agricultural-based business specializing in the delivery of American biodiesel to local and regional customers. With multifeedstock capabilities, the company partners with local farmers, and with restaurants to recycle cooking oil and grease for use in the production of biodiesel. "Our success in producing biodiesel has led us in other directions of business, all connected back to the goal of helping farmers and adding value to what they do for other customers," said Jaeger.
3. Plant Chemist, Louis Dreyfus Co. Mike Morgan heads special projects, testing method development and validation in the laboratory for the largest fully integrated soybean processing and biodiesel plant in the U.S. Located in Claypool, Indiana, the capacity for biodiesel production is 110 MMgy. Morgan first became passionate about biodiesel while in college at Utah State University, serving as a co-chair of NBB's Next Generation Scientists for Biodiesel program. He also used biodiesel he made at USU to set record speeds on the Bonneville Salt Flats.
4. Quality Consultant. Kent Bullard has served as an auditor for BQ-9000, the biodiesel industry's voluntary quality assurance program, since 2004. With a master's degree in quality assurance, he has audited 38 producers, marketers and labs. Auditors like Bullard have helped the program become a success; certified producers now account for more than 90 percent of the U.S. biodiesel volume. As a user himself, Bullard is also considered a biodiesel pioneer. While serving as fleet manager at Channel Islands National Park off the coast of Los Angeles, he led one of the first biodiesel programs at a national park, from 2000 until he retired in 2012.
5. General Manager, Western Iowa Energy. An accountant by trade, Brad Wilson spent several years as a financial auditor, mainly auditing grain cooperatives. He became president and general manager of the facility in Wall Lake, Iowa, in 2016. The multifeedstock plant recently grew from 30 to 45 MMgy and employs 30 people, many with young families in the town of about 800 residents. "It's gratifying to me knowing that we provide green jobs with good pay in a community that benefits greatly from the economic development that brings," Wilson said. "Our workers in turn support the schools and local housing market, among other things. Our plant also contributes to other businesses in the area, from family farms, to truckers to the railway."

(Biodiesel Magazine)
Groups Take Predictable Sides as US Biodiesel Trade War Develops
By  Ron Kotrba | March 23, 2017
Just hours after the National Biodiesel Board filed an antidumping and countervailing duty petition March 23 with the U.S. Department of Commerce and the U.S. International Trade Commission, claiming Argentine and Indonesian companies violate trade laws by flooding the U.S. market with dumped, subsidized biodiesel, other groups began taking sides in the global sector's latest biodiesel trade war.
"After Peruvians did the same a few months ago, the U.S. market's recourse to a legal solution clearly shows that the unfair trade imbalances caused by the Argentinians and Indonesian producers are impossible to cope with and pose a severe threat to the global biodiesel market's level playing field," said Raffaello Garofalo, secretary general of the European Biodiesel Board. 
"Most importantly, we hope the news will also send a strong signal to EU authorities about the undeniably legitimate character of the EU trade defense measures in place for biodiesel against Indonesia and Argentina."
Last year, Peru imposed antidumping and countervailing duties on Argentine biodiesel, and in late 2013 the EU did the same against Argentina and Indonesia, resulting in 41.9 to 49.2 percent duties on Argentina and 8.8 to 23.3 percent duties on Indonesia. In 2010, the EU imposed duties on U.S. biodiesel, which were subsequently extended. 
"The unfair trade practices resulting especially from the differential export taxes (DETs) in place both in Argentina and Indonesia have caused serious economic damage that has been challenged and condemned not only in the EU, but equally in Peru," the EBB stated. "Today, time has come for the NBB to denounce and disrupt the illegal trade patterns."
Countries such as Argentina and Indonesia encourage exportation of finished biodiesel from soy and palm oils, respectively, with DETs, through which decreased export tax rates are applied to various stages of the oilseed value chain. These tax schemes are designed to incentivize domestic manufacturing whereby the economic benefits associated with value-added production are retained in-country. According to a Global Agricultural Information Network report by USDA's Foreign Agricultural Service, titled, "Argentina Biofuels Annual 2016," in June 2016, the Argentine government taxed exports of biodiesel at 5.04 percent while whole soybean exports were taxed at 30 percent and soybean oil at 27 percent. Heather Zhang, an analyst with Prima Markets, said Argentina's biodiesel export tax ranged from a low of 1.62 percent to a high of 7.15 percent last year.
"Customers who chose to use internationally sourced biodiesel for transportation fuels or heating oil are significantly impacted by this petition, particularly in the Northeast Corridor," said Michael McAdams, president of the Advanced Biofuels Association (ABFA). "This piggybacks on NBB's efforts to change the existing blenders tax credit to a production credit. Both of these actions will have the effect of raising the cost of biodiesel to those selling the fuels to American drivers, while further lining the pockets of those who grow soybeans in the United States. These actions by a few large U.S. producers and U.S. soybean growers puts the entire renewable volume obligations (RVO) system at risk, as the current Renewable Fuel Standard program depends on security of supply from foreign markets to ensure the 2-billion-gallon mandate can be achieved."
U.S. biodiesel production tallies for the month of December provided by the U.S. Energy Information Administration, which are collected via a survey method and are typically conservative, show 143 million gallons of biodiesel was produced in December. Annualized, this represents nearly 1.72 billion gallons. EIA's actual reported total U.S. biodiesel production volume for 2016 comes in at 1.57 billion gallons. U.S. EPA's EMTS data for domestic production volumes based on D4 RIN generation, which include biodiesel and renewable diesel, show the U.S. manufactured 1.9 billion gallons last year.
EIA's own figures indicate 2.3 billion gallons of U.S. biodiesel productive capacity, so in context of annualizing its reported December volumes, there would still be roughly 25 percent idled capacity. In context of EIA's reported annual domestic biodiesel production volumes, idled U.S. capacity last year was 32 percent.
EIA's U.S. biodiesel production data do not include renewable diesel, which, upon completion of Diamond Green Diesel's expansion in Louisiana, coupled with REG Geismar's productive capacity, would add 350 MMgy. Moreover, many other U.S. biodiesel production facilities are undergoing expansions, and a new 30 MMgy soy biodiesel plant is slated for construction in North Dakota, further adding to the U.S. industry's productive capacity.
The U.S. imported a total of nearly 693 million gallons of biodiesel last year, according to EIA data. In addition, the U.S. imported 223 million gallons of renewable diesel. While Argentine and Indonesian biodiesel make up a majority of U.S. imports, if they suddenly ceased but biodiesel imports from Canada, Germany, Korea and Australia, along with renewable diesel imports from Singapore, remained at 2016 volumes, the U.S. would still import roughly 370 million gallons of biomass-based diesel. 
McAdams said ABFA members vehemently oppose the petition to levy duties on Argentine and Indonesian biodiesel. ABFA members include multinational commodities entities and biodiesel producers operating in Argentina, Indonesia and the U.S., such as Louis Dreyfus Co. and Wilmar, and consignees of U.S. imports including Louis Dreyfus, Wilmar, Targray and Musket Corp., which is affiliated with major consignee Biosphere Fuels LLC through Love's Travel Stops. 
According to data Genscape Inc. shared with Biodiesel Magazine, last year Biosphere received 47 shipments of biodiesel into the U.S. from Argentina totaling 145 million gallons, and 14 shipments from Indonesia totaling 33 million gallons. Louis Dreyfus brought in nine shipments into the U.S. from Argentina last year totaling 26 million gallons. Wilmar took 22 shipments of palm biodiesel into the U.S. from Indonesia in 2016 totaling 47 million gallons. Targray was the consignee for eight shipments of Indonesian biodiesel into the U.S. last year totaling 16 million gallons, along with deliveries from Argentina as well.
Louis Dreyfus and Targray are also members of the NBB. "NBB is unique in its representation of the entire market sector," NBB Communications Director Jessica Robinson told Biodiesel Magazine. "Unlike other groups, which, for example, may only represent large import interests, our members reflect the entire American biodiesel supply. In rare cases where interests do not intersect and a small group may carry a differing view, we welcome the discussion and are better positioned to meet consumer needs as a result. Imports, specifically from Argentina and Indonesia, have skirted fair competition to increase over 400 percent. We are talking about product used in the U.S. It's only right that products made here should get the chance to show up to a fair competition."
Another ABFA member is Neste Corp., which exported 223 million gallons of renewable diesel to the U.S. in 2016, according to EIA data, most of which arrived and was used in California where it was eligible for the federal blenders tax, RIN and LCFS credits.
"The National Biodiesel Board and U.S. biodiesel industry are committed to fair trade, and we support the right of producers and workers to compete on a level playing field," said Donnell Rehagen, CEO of the NBB. "This is a simple case where companies in Argentina and Indonesia are getting advantages that cheat U.S. trade laws and are counter to fair competition. NBB is involved because U.S. biodiesel production, which currently supports more than 50,000 American jobs, is being put at risk by unfair market practices."
Biodiesel imports from Argentina and Indonesia surged by 464 percent from 2014 to 2016, according to NBB. "That growth has taken 18.3 percentage points of market share from U.S. manufacturers," the organization stated.  
Argentina alone exported 129 million more gallons of biodiesel to the U.S. in 2016 than what the U.S. industry produced in 2010. Last year, U.S. ports received approximately 444 million gallons of Argentine biodiesel, according to EIA data. This is 64 million gallons more than what Argentina shipped to the U.S. in the previous three years combined. Argentine biodiesel represents the single largest source of imported biodiesel, accounting for 64 percent of biodiesel imports and more than 48 percent of combined U.S. biodiesel and renewable diesel imports.
U.S. biodiesel imports from Indonesia are also steadily climbing. In 2016, Indonesia exported roughly 102 million gallons of biodiesel to the U.S., according to EIA data, nearly twice as much as in 2013 (52.4 million gallons). Based on the huge palm industry in Indonesia and the players involved, most experts assume all the biodiesel entering the U.S. from Indonesia is palm-based product generating D6 RINs.
"The resulting imbalance caused by unfair trade practices is suffocating U.S. biodiesel producers," Rehagen said. "Our goal is to create a level playing field to give markets, consumers and retailers access to the benefits of true and fair competition."
NBB stated that, based on its review, Argentine and Indonesian producers are dumping their biodiesel in the U.S. by selling at prices that are substantially below their costs of production, reflected in the petition's alleged dumping margins of 23.3 percent for Argentina and 34 percent for Indonesia. The petition also alleges illegal subsidies based on numerous government programs in those countries, including DETs.
Louis Dreyfus told Biodiesel Magazine that the company was unable to comment at this time.


Read the original article as it appears in Biodiesel Magazine.   


(The Sustainable Biodiesel Alliance)
Sustainable Biodiesel Alliance Certifies SeQuential Plant

March 17, 2017

The Sustainable Biodiesel Alliance has announced the certification of SeQuential, the longest-running commercial biodiesel producer on the West Coast, for its innovative and nearly zero-waste production of renewable fuel.

The SBA has developed and implemented an objective certification standard for measuring the sustainability of biodiesel production and use. SeQuential has been awarded the Gold-level standard for biodiesel production via independent third-party audit score. 

SeQuential is dedicated to building a better energy model focused around regionally sourced biodiesel. All of the fuel SeQuential produces is made from used cooking oil recycled from restaurants and businesses within a roughly 500-mile radius of its Salem, Oregon, plant. Additionally, the company fuels its collection and delivery vehicles with high blends of its own biodiesel and offsets its energy consumption by using solar panels and setting regular energy conservation targets. 

"The Gold Certified level is currently the highest standard achieved for sustainable biodiesel production," said Jeff Plowman, vice-chair of the SBA and certification committee chair.

The audit checklist for biodiesel production is based on the SBA's  Baseline Practices for Sustainability, and evaluates the following:

-Air Emissions
-Water Resources
-Waste Handling
-Plant Energy
-Sustainable Sourcing
-Community Benefit
-Plant/Worker Benefit

"We're thrilled to be receiving SBA Gold Certification," said Tyson Keever, CEO at SeQuential. "It's rewarding to see our team's commitment to sustainability recognized. We look forward to continuing to strengthen our sustainability practices through ongoing partnership with the SBA."

This audit of SeQuential biodiesel production, the second of its kind, has given the SBA certification committee some valuable insight to the success of the audit procedure. The committee is dedicated to an ongoing analysis of sustainable practices in biodiesel production, distribution and use of biodiesel and is looking forward to a procedural review this year.

 School District Spearheads New Power Revolution

Posted February 12, 2017 by David Rice

San Diego Unified School District offered a glimpse into the ongoing implementation of its climate action plan on Thursday evening (February 9) with its Family Climate Action Summit. A crowd of about 100 trickled into the auditorium at Kearny High School, where climate action awards were presented and school-board vice president Kevin Beiser, along with students and faculty from Montgomery Middle School, presented a host of actions that have been taken to "green" campuses across the city.

"Our gardens are outdoor classrooms," said Patrick Meehan, an English teacher at Montgomery. "It's enriching the science curriculum - observation, data collection, keeping good records. This is the beginning of getting kids involved and learning about the environment through their classes."

Meehan and Emalyn Leppard shared progress on their school's garden, which began in 2003 and has grown to include a gazebo for outdoor lessons, a composting program that uses waste from the school's cafeteria, and a greenhouse where students practice aquaculture, raising plants and fish whose growth support one another. Between 400 and 500 students a year participate in one of the garden programs.

Beiser provided more examples of student participation, including a climate learning center implemented at Hoover High and a series of district-wide competitions that have sought solutions from students to improve district campuses.

"Scripps Ranch High School has an environmental science building where students monitor their own windmills," Beiser cited as another example. "They regulate and contribute to make sure the monitoring station is up and running; they also monitor the solar production at their school's facility and track and maintain the underground 80,000 gallon tank that captures rainwater to irrigate the landscape.

"We've worked very hard to create energy-efficient facilities worthy of our children that also provide curriculum about environmental sciences and the growing green industrial sector in the future."

The district  adopted its climate plan in July 2015, which mirrors the one later  adopted by city government in that it seeks to source 100 percent of its energy from renewable sources by 2035.

"Phases one and two are generating over 10.5 megawatts of power, saving the school district $2.5 million every year on our electric bills, money that we can spend in the classroom on smaller class sizes, music, and arts," said Beiser of the district's existing solar-power installations. "It also saves over 4900 tons of carbon that's not being admitted into the atmosphere."

A third phase, coming in 2018, will add another 5 megawatts of solar generating capacity, bringing total annual estimated savings to $3.9 million. Beiser also ticked off a list of accomplishments related to conservation efforts.

"LED lighting systems have reduced our energy consumption by 1.4 megawatts, saving over $300,000 a year," Beiser continued. "We reduced our water usage by 39 percent in 2016 by implementing a central irrigation monitoring system to adjust watering based on weather data, and to help us identify leaks anywhere in the system."

He added that the district has switched from styrofoam to compostable lunch trays, diverting ten million of them from local landfills annually. Cafeterias have also implemented "Meatless Monday" options, and school buses now run on biodiesel, which emits 90 percent less carbon than traditional diesel fuel.

"We're fortunate to live in a city that's a leader in innovation, sustainability, and alternative energy, and we have one of the leading climate action plans in the country," added city councilmember Barbara Bry (District 1), who attended to talk with parents about the city's climate plan. "It's clear to most scientists that climate change has become a permanent part of our world, and it's not going away. We're a coastal city, so we have particularly large risks.

"All of us as individuals have a role to play. We can walk more, bike more, drive less, consume sustainably, plant native species and shift to drought-tolerant yards, shift to forms of alternative energy...and it's time to start thinking about taking these steps now."

The forum concluded with a presentation from the Sierra Club's Pete Hasapopoulos and Christine Herbeck on  community choice aggregation, an energy model in which a nonprofit entity takes responsibility for energy generation while a traditional utility remains responsible for maintaining the power grid and offering consumers who don't want to buy in to the program an alternative power supply.

Proponents have argued that community choice, already in place in several regions of California, hastens the adoption of renewable energy while resulting in lower electricity bills for consumers. The aggregators also pay individual solar producers more for their unused power, which could be a boon for the school district, given its aggressive solar-installation schedule. Such markets, unsurprisingly, have been hotly contested by traditional utilities like San Diego Gas & Electric.

"Community choice energy is the single biggest thing the City of San Diego can do to reduce greenhouse gases; it's epic in proportion, and that's why we're so dedicated to achieving it here," said Hasapopoulos, who gave an overview of how the system could work. "That's because we would have a new, not-for-profit energy provider that would serve nearly 1.4 million people."

Added Herbeck, who recently began volunteering for the community-choice push, "I had no idea that this issue actually impacted our schools so much. Our school district is paying a lot of money for energy right now, and they've had battles with the utility over this issue. There's an opportunity to save our schools some serious money, and if you're a parent, you know how hard we fight for every dollar that goes back into our classrooms."



The public ARB board meeting on the Final Proposed Scoping Plan will be held on June 22nd and 23rd.
CBA has been coordinating with NBB to monitor and address issues of concern to our industry in the plan. The m ain Scoping Plan page is here: https://arb.ca.gov/cc/scopingplan/scopingplan.htm.

CBA is reaching out to members of ARB's AB 32 Environmental Justice Advisory Committee (EJAC). Committee meeting notices and details are posted on the ARB's EJAC webpage here:  www.arb.ca.gov/cc/ejac/meetings/meetings.htm.
Legislative Budget Subcommittees have begun their review of the Governor's 2017-2018 Budget Proposal, which includes $2.2 billion in Cap and Trade Funds, if the program is extended with a 2/3 vote. No action is likely to be taken by the Budget Subcommittees until after the Governor issues his May Budget Revise. 
At the same time, the Administration continues its process of better defining how it recommends spending those monies. In a recent ARB workshop, staff proposed $20 million be used to promote in-state biofuels production. 
CBA, along with the Biofuels Coalition, is meeting with the Governor's staff and legislative members of the budget committee to express the need for in state production incentives.   
(The Biofuels Coalition works to secure  in-state biofuels incentive funding from Cap and Trade auction proceeds, which are allocated through the state budget, specifically ARB's Greenhouse Gas Reduction Fund or  GGRF). 
ARB Joint Funding Plan for Low Carbon Transportation and  AQIP
CBA monitors the public workshop on the Fiscal Year (FY) 2017-18 Funding Plan for Low Carbon Transportation investments and the Air Quality Improvement Program (AQIP). ARB is postponing the workshop originally scheduled for April 6,  2017 to discuss the plan and the potential $25 million VW settlement funds for zero-emission vehicle aspects of vehicle replacement programs.  For info about a new date:  https://www.arb.ca.gov/aqip/ .

The ADF regulation, which became effective January 1, 2016, includes reporting and recordkeeping requirements applicable to entities in the biodiesel industry. Biodiesel producers, importers and blenders must submit quarterly reports.  Biodiesel producers, importers and blenders are required to report and keep records concerning biodiesel production, sales, and blending. Biodiesel distributors and retailers are only required to keep records. 
Find the current FAQ and Reporting Forms at: http://www.arb.ca.gov/fuels/adf/adfdocs.htm. 

T he presentation for the ARB May 23rd, 2016 public workshop, which has detailed and very helpful diagrams is here: http://www.arb.ca.gov/fuels/diesel/altdiesel/meetings/meetings.htm. 

NOTE: Most in-state biodiesel fuel businesses are required to register under the Air Resources Board's Motor Vehicle Fuel Distributor program (MVDP). See the article on our Members Only page.


Verification Rulemaking
NBB and CBA submitted joint comments in response to the first Biodiesel / Renewable Diesel public working meeting, which was held on February 10th in  Sacramento.  A product of the highest level of expertise in the field, the letter offers detailed technical feedback on ARB's  current Tier 1 and Tier 2 CA GREET models, the proposed  simplified CI application data summary form, and other questions agency staff is seeking feedback on.  The presentation materials and link to Stakeholder Feedback, where this letter can be found here: 
Lifecycle Assessment Modeling
Our industry will participate in ARB staff's public working meeting on lifecycle assessment modeling on April 4th in Sacramento. Meeting details are here (presentations will posted in advance): http://www.arb.ca.gov/fuels/lcfs/lcfs_meetings/lcfs_meetings.htm.
Pathway Approvals
This month 8 biodiesel pathways were approved under the rules of the readopted LCFS. Biodiesel Magazine has details

Credit Activity
ARB publishes monthly LCFS credit transfer activity reports on the second Tuesday of every month:  https://www.arb.ca.gov/fuels/lcfs/credit/lrtmonthlycreditreports.htm .

Staff also publishes weekly LCFS credit transfer activity reports on the Tuesday of every week:  https://www.arb.ca.gov/fuels/lcfs/credit/lrtweeklycreditreports.htm .


Awards have been announced for Grant Funding Opportunity (GFO-15-606), Community-Scale and Commercial-Scale Advanced Biofuels Production Facilities, and we are pleased that Crimson Renewable Energy and New Leaf Biofuel will receive funding toward  expanding production. See the  Notice of Proposed Award here: 

The 2017-2018 Investment Plan Update for the Alternative and Renewable Fuel and Vehicle Technology Program - Lead Commissioner Report is now available here:


See article above.

For questions on federal policy issue, please contact the Washington office of the National Biodiesel Board (NBB) at  202-737-8801 .

NBB Fueling Action Logo
Reach Out to Your Members of Congress!
In early March, NBB Governing Board members, staff, and contractors held meetings with members of Congress and staff for the Committees that may address tax issues and the RFS. Please join this effort by sending a message to your representatives in Congress online ! You can do it in less than 30 seconds, but adding details about your work in the industry lets your representatives know why our industry is critical to your state!

Trump's Executive Actions Target Clean Power Plan, Not RFS
According to the NBB, on March 28th, President Donald Trump signed an executive order related to several regulations and actions under the Obama Administration that sought to regulate or address greenhouse gas emissions and climate change. The text of the order has not been published yet, but this order largely sought to target EPA's regulation addressing existing power plant greenhouse gas emissions known as the Clean Power Plan for review or repeal. Although not anticipated to address the Renewable Fuel Standard, a statutory requirement, we continue to monitor actions taken by the new Administration.

2017 RFS RVO's Became Effective 3.21.17
The NBB has stated that: "The effective date of the 2017 Renewable Fuel Standards is 3.21.17. Although EPA finalized the 2017 RFS and 2018 biomass-based diesel volume in December of 2016, the new Administration had temporarily delayed the effective date of certain actions taken by President Obama's administration until March 21.  This included the 2017 RFS, which originally had an effective date of February 10th. EPA published another notice delaying the effective date of five other EPA regulations, but the 2017 RFS was not among the regulations that had been further delayed.

Under EPA's final standards, the 2017 minimum volumes under the RFS are as follows:
* Conventional Biofuels: 15 billion gallons (ethanol equivalent gallons)
* Advanced Biofuels: 4.28 billion gallons (ethanol equivalent gallons)
* Cellulosic Biofuels: 311 million gallons (ethanol equivalent gallons)
* Biomass-based Diesel:  2.0 billion gallons (biodiesel equivalent gallons)
* Total Renewable Fuels: 19.28 billion gallons (ethanol equivalent gallons)"

Thank you for your engagement and support of CBA and for your time and effort on behalf of our industry. I look forward to continuing to work with you.

Celia DuBose
Executive Director
California Biodiesel Alliance (CBA)