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California Biodiesel Alliance News

California's Biodiesel Industry Trade Association  

August 2015      

In This Issue
Save the Date: 
CBA's 5th annual California Biodiesel Conference will be held on February 24, 2016. This one-day event will take place the day after CALSTART's 2016 Low Carbon Fuels Summit at the same venue, the Capital Ballroom in downtown Sacramento. Details will be posted on our Home page as they are finalized.
A biodiesel delegation from the Midwest recently visited Northern California, and this issue begins with a story about local involvement in this very successful trip. Not only are LCFS credits prices way up, but per the next story, the program continues to fight off legal challenges! Other stories detail just how thorough our industry has been in making our case for higher RFS volumes and just how central a place political machinations that could affect the biodiesel tax incentive have become.

You don't get more central than the presidential politics front, so it's great news that the Iowa Biodiesel Board's annual independent survey research showed that 76% of voters in Iowa support strengthening the RFS to increase biodiesel use and believe that a presidential candidate's view on the RFS is important to their vote. Read more here:

See the Policy and Industry sections below for updates on CBA's legislative efforts (they are going well); key meeting details for the ADF adoption and the LCFS re-adoption, federal issues, industry updates and more.  
To view back issues of this newsletter and CBA Email Alerts 

click on the "View CBA Email Newsletter Archive" button on our Home page.   
CBA Meets with Midwest Biodiesel Delegation In San Francisco

Representatives of the Iowa Soybean Association, the Illinois Soybean Program Operating Board, and the American Soybean Association, led by Tom Verry of the National Biodiesel Board (NBB), were in San Francisco recently for a 3-day visit filled with biodiesel-related meetings and other events. 

On August 25th, the California Biodiesel Alliance (CBA) was pleased to have the opportunity to meet with this biodiesel industry delegation, which included association directors and staff, national technical experts, and farmer husband and wife teams (many wearing more than one hat), and to join them in some of those activities.  

Celia DuBose, CBA Executive Director, welcomed the group and gave an overview of biodiesel in California with a focus on the history and accomplishments of CBA. Ryan Lamberg, Executive Director of the California Biodiesel Initiative, a CBA/NBB collaboration focusing on environmental and regional issues, and Dave Williamson of Biogenic Energy, who is well-known for his pioneering biodiesel fleet management, participated in what became an informal and very lively discussion. The group was interested to learn about LCFS, the growing California market, and the challenges our industry has faced and met as we move toward regulatory stability after years of concerted efforts on many fronts.

Mellera SFMTA Tour
Marty Mellera of SFMTA talking 
with delegation members.
he group then toured the San Francisco Municipal Transit Agency's (MTA) North Beach  Garage . Marty Mellera, Manager of Climate Action and Greening for the agency and the mastermind behind their B20 program, led the tour and explained that SF's diesel fleet has been running on B20 since the former mayor's executive order mandated it in 2007.  He talked about the value of biodiesel as the City's main GHG reduction program. The day also included a round-trip to Larkspur for lunch on the Larkspur Ferry, which uses a low biodiesel blend.

The next day the group traveled to the Community Fuels biorefinery in Stockton on a high-blend biodiesel powered Incredible Adventures tour bus. Hosted by CEO Lisa Mortenson, the group was treated to a tour of the plant, which boasts a new terminal loading rack with storage.

CBA was happy to be able to thank in person the representatives of the soybean industry and the associations that have very generously supported the work of the National Biodiesel Board in California. This work is a critical part of our industry's sustained engagement with state agencies toward creating the best possible regulations and policies allowing biodiesel to move forward and thrive in California.

The delegation included: Mike Cunningham of the American Soybean Association; Grant Kimberly, Ron and Carole Heck, and Rolland and Donna Schnell of the Iowa Soybean Association; and Rebecca Richardson, Rob Schafer, Gary Berg, and CW Gaffner of the Illinois Soybean Program Operating Board.
Judge Rebuffs Latest Challenge to Calif. Fuel Standards

Jeremy P. Jacobs, E&E reporter
Published: Monday, August 17, 2015

A federal judge last week largely upheld one of California's primary efforts to address climate change in a challenge from crude oil producers.

The judge largely granted the state's motions to dismiss the litigation on California's low-carbon fuel standard, holding that previous lawsuits had already resolved most of the issues in the case.

California's fuel standards were developed under the state's landmark 2006 global warming law, A.B. 32, which seeks to cut greenhouse gas emissions to 1990 levels by 2020.

The standards assign all fuels in the state for the transportation sector a "carbon intensity" rating or score. That is calculated by taking the life cycle of a fuel's emissions into account, including where it is produced, where it is refined and how it is transported to the state. The regime went into effect in January 2011.

Fuel and ethanol producers launched an early legal assault on the regime, claiming that it discriminated against out-of-state refiners and, consequently, violated the Constitution's Commerce Clause.

The San Francisco-based 9th U.S. Circuit Court of Appeals rejected those arguments in September 2013, and the Supreme Court declined to review that ruling (Greenwire, June 30, 2014).

Crude oil producers continued their litigation, however, lodging new complaints about the amended version of the standards.

Last week, Judge Lawrence O'Neill for the Eastern District of California largely dismissed those claims, concluding that the 9th Circuit had already ruled on them.

T he challengers, he wrote in a 57-page order, "have alleged no facts and have provided no argument to support a finding that the amended" fuel standards "operates differently" from the original.

While O'Neill sided with the state almost entirely, he did allow the case to move forward on the issue of whether the original fuel standards discriminate against ethanol producers.

Click here for the order.

Biodiesel Industry RFS Comments Leave No Stone Unturned

In written comments submitted to the Obama administration, CBA called for higher volumes under the pending modest RFS proposal establishing Biomass-based Diesel volumes for 2014-2017. The comments began with a bang: "In 2014, as a result of the poor market conditions created by the lack of a strong biodiesel mandate, four of California's eleven biodiesel plants closed their doors. Other plants scaled back production, laid off workers, deferred expansion projects, and lost investment opportunities."
The comments call for biodiesel standards of not less than 2 billion gallons for 2016 and 2.3 billion gallons for 2017 and cite arguments from the National Biodiesel Board (NBB), which has worked tirelessly on this issue of critical importance to the health of the biodiesel industry. 
It is not uncommon for CBA's comments, especially on California matters where we work closely, to state that we support the technical comments of the NBB. However, in this case, CBA repeatedly referenced arguments put forth in the NBB's case for higher volumes, which total 150 pages and detail our industry's case on the broad range of issues upon which the EPA will make its final decision. 
CBA's comments can be viewed here. The NBB's comments, based on months of work by staff and the RVO Working Group, include an unprecedented level of technical and economic analysis and documentation on points ranging from the technical and performance qualities of the fuel to production capacity, imports, and feedstock supplies. They can be viewed or heard (via podcast) at the bottom of this page.  
The EPA has said it plans to finalize the rule by November 30th after taking into consideration the many thousands of public comments they have received.  

(E&E News: Energy Policy) 
 Reid Willing to Deal on Crude Exports 

Geof Koss, E&E reporter

LAS VEGAS -- Senate Minority Leader Harry Reid (D-Nev.) said yesterday he sees potential for an agreement on lifting the crude oil export ban in exchange for extending renewable energy tax credits.

In an interview with Greenwire at his eighth annual Clean Energy Summit here, Reid declined to take a position on ending the decades-old export prohibition, saying he sees merit in arguments for and against doing so.

B ut he made clear he is willing to sit down with Republicans and discuss the issue.

"And I would hope that we can get something in return if we're willing to do that," Reid said. "There's a lot of things that we could do, with more tax credits and things of that nature."

Reid is the latest -- and most senior -- Democrat to suggest the Senate minority may be willing to back a repeal of the export ban if provisions aiding renewable sectors are part of the deal. Sens. Martin Heinrich (D-N.M.) and Maine independent Angus King, who caucuses with Democrats, floated the idea during last month's Energy and Natural Resources Committee markup of legislation to end the ban and expand offshore drilling (E&E Daily, July 31).

S enate Energy Chairwoman Lisa Murkowski (R-Alaska) earlier this month said other Democrats have approached her with compromise proposals for allowing crude exports as well (Greenwire, Aug. 7).

But Reid's remarks show that Democrats see the export issue as a bargaining chip for advancing their own energy priorities -- extending the renewable production tax credit and investment tax credit -- in a Republican-led Congress.

Pressed further on the issue during a news conference yesterday, Reid decried the lack of compromise in the "Koch brother, tea-[party]-driven" Republican Congress.

"And that's too bad," he said. "And I think this is one of those examples where we can sit down -- no one's going to get everything they want, but let's see if we can come up with something that's good for the country. That's something we need to do; I'm interested in this, to see if something can be done to help both parties."

Reid, who repeatedly criticized the Koch brothers throughout the daylong conference, struck a pessimistic tone for the prospects of the Energy Committee's bipartisan energy package, which Murkowski is aiming to bring to the floor in the fall.

"With people so afraid of the Koch brothers, I think the chances of getting something done like that are not very good," Reid said.

However, he conceded the measure -- which focuses heavily on boosting efficiency -- may be able to eventually make its way through the Senate before the end of the 114th Congress.

"We might be able to get something with energy efficiency, but I don't think we're going to get much that's going to be something to write home about," he said.

Reid's willingness to discuss exports is also notable given that environmentalists are starting to mobilize against lifting the ban. The liberal Center for American Progress last week released a report highlighting environmental concerns over crude exports, which it said would cause domestic demand for drilling to expand (Greenwire, Aug. 21).

Former CAP President John Podesta yesterday sidestepped a question from Greenwire about whether trading crude exports for renewable tax credits was a deal worth pursuing, saying he's not close enough to the "horse trading" on Capitol Hill anymore.

But he acknowledged White House appetite for extending the production tax credit and investment tax credit, as well as the approaching end of the fiscal year. "I think this will be in the discussion, in the mix," he said.

Podesta, who is leading Hillary Clinton's presidential campaign, also declined to proffer an opinion on what the former secretary of State thinks about crude exports.

"I'm not going to get ahead of her on that because, frankly, I haven't discussed it with her," he said.


Renewable Energy Group Closes Acquisition of Imperium Renewables 
By REG --- 08/19/2015
(AMES, IA)---Renewable Energy Group, Inc. (NASDAQ:  REGI) completed its acquisition Wednesday of substantially all the assets of Imperium Renewables, Inc., the Company announced today.

REG paid Imperium $15.0 million in cash and issued 1.675 million shares of REG common stock in exchange for substantially all of Imperium's assets, including the 100-million gallon nameplate biodiesel refinery and terminal at the Port of Grays Harbor, WA.   For two years post-closing, 
Imperium may receive up to $0.05/gallon for biodiesel produced and sold at Grays Harbor.  REG assumed $5.2 million of Imperium's debt from Umpqua Bank, which has agreed to provide the newly-named REG Grays Harbor, LLC with an additional loan capacity of up to $5.0 million to fund capital expenditures and improvements at the facility.  In addition, Imperium retained its net working capital value of approximately $25 million.

"We are excited to now offer high-quality REG-9000 biomass-based diesel produced at Grays Harbor to better serve new and existing customers along the west coast and other low-carbon fuel markets, " said REG President and CEO Daniel J. Oh.  "The transition at Grays Harbor has been seamless so far thanks to the dedicated team at Imperium who we are now proud to have as members of the REG family."

Most of Imperium's employees have agreed to stay on with REG.  The Grays Harbor location includes 18 million gallons of storage capacity and a terminal that can accommodate feedstock intake and fuel delivery on deep-water PANAMAX class vessels as well as possessing significant rail and truck transport capabilities.  A formal grand opening will be announced at a later date.


(KPBS) By Matt Hoffman

It's 7:30 a.m. on game day at Petco Park in downtown San Diego and the food trucks have just started rolling in.

As part of his daily routine, Petco Park executive chef Carlos Vargas awaits the fresh produce.

During home games, local growers like Suzie's Farm and Melissa's Produce, based out of Los Angeles, make daily deliveries of fresh vegetables and fruits.

"See the quality of the raspberries that we have in here? It's just unbelievable how good and sweet they are," said Vargas after tasting one of the raspberries.

In late June, the San Diego Padres and concession partner Delaware North were recognized as "Champions of Game Day Food" in a joint report by the Natural Resources Defense Council and the Green Sports Alliance.

The report named the Padres and Petco Park as one of the top locations for stadium eats in the country for their sustainability efforts and food quality.

Allen Hershkowitz, president for Green Sports Alliance, said the Padres are setting an example for other stadiums.

"The Padres are providing valuable lessons not only to professional sports venues throughout North America, but actually professional sports venues throughout the world," Hershkowitz said.

More than 95 percent of the San Diego Padres concession stands and restaurants get their food from Southern California.

Scott Marshall, vice president and chief hospitality officer for the Padres, said food sales are up.

"We've seen an overall increase in food sales because people are coming to the ballpark earlier to have a meal, they're staying later," Marshall said. "Typically our locations would close at the seventh inning. We're seeing that go beyond the game because people want to have that food experience."

That food experience includes 15 local restaurants that have set up shop in the stadium concourse, giving Padre fans a unique taste of San Diego.

"What we found by bringing in and introducing Hodads, was that we started something very special," Marshall said. "From that the floodgates kind of opened and we had Phil's come in, we had Seaside Market come in, Rimel's, Zenbu, Pizza Port, and we really kinda put a taste of San Diego here at the ballpark."

Getting local food reduces what environmentalists call food miles - costs and resources used when transporting food. Vargas said there is a noticeable freshness using local vendors.

Traditional concessions like nachos, hamburgers, and hot dogs come locally as well, with the hot dogs coming from just outside Chula Vista.

"The company is Tarantino's. That's who we buy all of our sausages and all of our friar frank dogs. That's our actual dog here for the stadium," Vargas said.

But what happens to the food that doesn't get eaten? What's still good is donated to local shelters.

Food that's considered waste may end up in one of the 20 waste reduction initiatives of the ballpark. Other green practices include making mulch from grass clippings and creating biodiesel with an Escondido-based company.

"Buster Biofuels comes in and they take all of our used cooking oil and they turn it into biodiesel," said John McEvoy, Padres director of facilities services. "We actually use about 125 gallons of that back in the tractors that we use on the field for mowing the grass throughout the season."

The Padres waste diversion rate is currently at 77 percent, with plans for 80 percent by the end of 2015.

(BIOFUELS DIGEST) Pacific Ethanol switches on Corn Oil production at its Boardman, Oregon plant

July 29, 2015 | Jim Lane

In California, Pacific Ethanol has begun commercial production of corn oil utilizing Valicor's corn oil recovery system at its Columbia ethanol plant located in Boardman, Oregon. With the completion of this 2-year initiative, all four of the western Pacific Ethanol plants are now producing corn oil.

In May, Pacific Ethanol began commercial production of corn oil utilizing Valicor's proprietary VFRAC corn oil recovery system at its Madera, California plant. Neil Koehler, the company's president and CEO, stated: "With the production of distillers corn oil at our Columbia plant, all of our ethanol facilities separate corn oil for sale into high-value markets.

Corn oil production has been a major milestone for the company, and one that we expect to provide significant benefits as it broadens our co-product mix, further diversifies our revenue streams and enhances operating income."

(OREGON PUBLIC BROADCASTING) Mayor Details Portland's Plans To Battle Climate Change Following Vatican Trip

by OPB Staff OPB | July 28, 2015 3:59 p.m. | Portland

Portland Mayor Charlie Hales last week joined more than 60 mayors from around the world on a trip to The Vatican to meet with Pope Francis about climate change.

The group also discussed ways to address human trafficking during the two-day summit.

On Tuesday, Hales spoke with Think Out Loud host Conrad Wilson about the city's plans for curbing the effects of climate change following his trip.

"We've just actually looked at the idea for something called 'green bonds' where you can finance environmentally-responsible investments with a bond issue which is then sold in the marketplace at reasonable rates. We think Portland is going to be an early adopter and world leader in using green bonds to finance things," Hales said.

Hales also spoke about the city's reliance on fossil fuels.

"TriMet brags about biodiesel on our buses. That's great, but they're only using 5 percent biodiesel on our buses. Let's see if we can take up a notch, or two, or three or four notches and really get serious about traveling around the city using less fossil fuel."

The mayor also spoke about adding more solar panels to buildings and increasing the scale of the city's green initiatives.


French fries  Beautiful oil   French fries

CBA continues its work on behalf of the BIofuels Initiative, a low-carbon biofuels coalition effort to secure funding from Cap and Trade proceeds for in-state production and infrastructure. Though funding of this kind was not allocated in the Governor's original investment plan, we remain optimistic that our efforts are moving this agenda forward, and were pleased to see language regarding the value of low-carbon biofuels in the program's 2nd draft Investment plan. 

The adoption of the ADF regulation, still on track for full implementation on Jan 1, 2016, has been postponed and will be considered at the September 24-25, 2015 meeting (in Diamond Bar) of the board of ARB. ADF rulemaking details and a link to CBA and NBB comments on the most recent proposed amendments are available here: http://www.arb.ca.gov/regact/2015/adf2015/adf2015.htm.    

T he readoption of the LCFS regulation, still on track for full implementation on Jan 1, 2016, has been postponed and will be considered at the September 24-25, 2015 meeting (in Diamond Bar) of the board of ARB. LCFS rulemaking details and a link to the latest comments from CBA and NBB are available here: http://www.arb.ca.gov/regact/2015/lcfs2015/lcfs2015.htm.     
CEC plans to offer a $16.6 million Biofuel Production and Supply solicitation in late 2015 or early 2016. Details will be posted here: http://www.energy.ca.gov/contracts/transportation.html.

Also, on September 18th, the 
Lead Commissioner for Transportation of the California Energy Commission, Janea A. Scott, will conduct a Technology Merit Review workshop to highlight key ingredients for successful development of biofuel and biomethane projects in California funded by the Alternative and Renewable Fuel and Vehicle Technology Program. Lead Commissioner Janea A. Scott will preside over the workshop and other Commissioners may attend, but no business will be discussed and no votes will be taken. 

For complete details and remote access instructions, please see the notice at 
The State Water Board has sent out a notice to underground storage tank owners and operators announcing that new revised federal UST regulations were issued on July 15th, 2015. According to the document, the Water Board is reviewing the federal regulations to see if new California statute and regulations are in order.  The notice says that a switch in fuels to a blend above B20 would require the owner to notify the CUPA 30 days prior and that owners/operators must demonstrate compatibility for as long as the substance is stored. Click here to download the notice. 

See our Regulatory Matters webpage for information on compliance issues.   

AB 1032 our bill to correct the red biodiesel tax problem, has passed out of the committees and we are optimistic about its chance of becoming signed into law this year. The next two weeks are Floor Sessions only with September 11th being the last day of the session. 

Please contact the Washington office of the National Biodiesel Board (NBB) at 202-737-8801 for questions on these federal policy issues. Visit their Fueling Action webpage for more info.       

The Senate Finance Committee voted last month to reinstate the biodiesel tax credit through 2016 as part of a package of tax incentives and to change it from a blenders credit to a domestic production credit for the period extended, through 2016. 

The NBB makes the point that "an important benefit of the producers tax credit is that it levels the playing field for U.S. biodiesel producers who are competing with foreign production. For example, since 2009, the European Union has levied duties on U.S. biodiesel that effectively block U.S. biodiesel from entering the European market. At the same time, U.S. policy is incentivizing European biodiesel shipments to the U.S. by rewarding it with the $1-per-gallon credit. Without this reform, U.S. tax policy is increasingly contributing to U.S. companies losing U.S. market share to subsidized foreign production in Europe, Argentina and other nations." Also, see article above: Reid Willing to Deal on Crude Exports.
See article above.  
As mentioned here previously, based on our industry's concern about growing volumes of imports from Argentina, which have been approved for RIN generation under RFS, our industry is asking the EPA to consider this fact when determining final RVO numbers for 2015 through 2017 for both the Biomass-based diesel and Advanced Biofuels categories.     
  NBB Fueling Action Logo  





If you are reading this and are not yet a member, please Join Us! CBA offers several membership levels with the following annual dues.
Producer Board Member
* Production greater than 8 million gallons per year: $10,000
* Production less than 8 million gallons per year: $5,000

Marketer Board Member
* Sales greater than 8 million gallons per year: $10,000
* Sales less than 8 million gallons per year: $5,000

Other Board Member: $5,000
Applicants for CBA's Board of Directors must print and fill out the Voting Membership Application from our Join Us webpage and email or mail it to Celia DuBose at the address listed there.

NOTE: Dues amounts apply whether your business is based inside or outside of California and regardless of where your fuel is sold.

Non-voting memberships are as follows:
* Gold: $3,000
* Silver: $2,000
* Bronze: $1,000

INDIVIDUAL MEMBERSHIP (includes nonprofit organizations): $100
* Students/veterans: $25

Membership benefits include:
* Your company's logo, link, and description on our Members webpage (Business membership and above).
* Participation in CBA's in-person member meetings.
* Participation in policy discussions and legislative/regulatory visits in Sacramento.
* Internal email communications on important industry issues as they arise.
* A discount on CBA events.



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Thank you for your commitment to biodiesel 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