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California Biodiesel Alliance News
California's Biodiesel Industry Trade Association
February 2015
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We are very happy to welcome new Bronze Business members Biogenic Energy and Starfuels by including their logos and company descriptions in our Welcome section below.
It wasn't just our 4th annual conference and CALSTART's Clean, Low-Carbon Fuels Summit that made February an important month in the life of California's low carbon fuels sector. This issue brings major updates on the LCFS, the ADF regulation, the Biofuels Initiative, ambitious plans by our state's lawmakers to extend and expand clean energy goals, and more.
Special thanks to Senator Barbara Boxer for going to bat for the California biodiesel industry when she said in a letter to the head of EPA on the Renewable Fuel Standard (RFS): "I urge the agency to issue the 2014 biodiesel volume levels in a manner consistent with the actual industry production levels and to ensure that the agency move toward meeting the statutorily prescribed schedule for setting Renewable Volume Obligations (RVO)." She also said, "Indeed, biodiesel producers in California have seen significant impacts caused by the original proposal and current delays."
NOTE: You can read a shorter version of the first article here. It doesn't, however, have links, embedded in context, to the ICCT report or the Promotum report, which was commissioned by the Natural Resources Defense Council (NRDC), the Union of Concerned Scientists (UCS), and the Environmental Defense Fund (EDF).
To view back issues of this newsletter and CBA Email Alerts
click on the "View CBA Email Newsletter Archive" button on our Home page.
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Biodiesel's Unique Role in Meeting the State's AB 32 Goals Presented at Fourth Annual California Biodiesel Conference
Curtis Wright, Chairman, California Biodiesel Alliance, opened the fourth annual California Biodiesel Conference with an appeal for attendees to join the organization as it steps up its work to educate incoming members of the state legislature and involve key policy makers in efforts to advance the biodiesel industry in California. Toward that end, the fourth annual conference was held for the first time this year in downtown Sacramento. In his keynote address, Henry Stern, Principal Consultant for Senator Fran Pavley, author of the landmark climate solutions legislation, AB 32, thanked the audience for coming to town. He encouraged industry participants to come back again and again to tell our positive biodiesel story.
Boldly addressing the key theme of the conference, The Unique Benefits of Biodiesel - California's Advanced Biofuel, Don Scott, Director of Sustainability, National Biodiesel Board (NBB), kicked off the first panel's presentations with a fact-filled myth-busting talk that began with a few basics - that compared to petroleum diesel biodiesel reduces GHGs by 50 - 80%, wastewater by 79%, hazardous waste by 96%, and prevents 664 premature deaths in California from reduced PM2.5 exposure.
His detailed rebuttal of anti-biofuels proponents' recent arguments in the media, presented the facts that debunk the food vs. fuel myth. Scott showed that, among other key facts, total soy production is growing at a faster rate than calorie demand. He ended with the simple statement that when we satisfy our demand for protein, we have bioenergy left over. But not before proposing a switch from all food-based fuel language to the following: "Lipid based fuels" (fats, oil) for biodiesel; "Cellulosic based fuels" for fuels from fiber, stems, wood, etc.; and "Carbohydrate based fuels" (starches, sugars) for ethanol from these sources.
Tim O'Connor, Senior Attorney and Director, California Climate, Environmental Defense Fund, discussed the importance of California's fuel transition with its key element of fuel diversification. He made the strong point that the state must export to the world its successful AB 32 programs, especially the Low Carbon Fuel Standard (LCFS) and Cap and Trade, which provide unparalleled models for pollution reduction and increased energy security.
Bonnie Holmes-Gen, Senior Director, Air Quality and Climate Change, American Lung Association in California, focused on the public health benefits of our state's clean energy future. She included very important information about solutions under SB 535 (De Leon) that the state's low carbon fuels sector can offer to communities most impacted by the devastating health impact of petroleum diesel pollution and the lack of good family-supporting jobs. SB 535 requires the investment of Cap and Trade auction proceeds in disadvantaged communities.
Wrapping up as panel moderator, Lisa Mortenson, Co-Founder and Chief Executive Officer, Community Fuels, gave an enthusiastic review of biodiesel's benefits. Showing a chart of emissions associated with smog, cancer causing compounds, and respiratory illness with bars very much upside down (showing negatives up to 100% for some), she made the compelling statement: "Imagine if ... biodiesel were the standard and petroleum diesel were trying to gain approval!"
The first of two regulatory panels began with Richard Corey, Executive Officer, California Air Resources Board (ARB), who discussed the success of California's strategies that are reducing GHGs in every sector by improving energy efficiency, providing cleaner fuel choices for consumers, improving air quality, and spurring investments in a clean economy. He talked about the importance of cross-jurisdictional coordination with sister agencies on the Pacific Coast Collaboration as an important step in achieving deeper and broader GHG reductions and cited the recent International Council on Clean Transportation (ICCT) research showing that the clean fuel goals of all jurisdictions are achievable simultaneously.
Adding to ARB's well-known acknowledgement of biodiesel's GHG-lowering emissions profile (biodiesel has generated 13% of LCFS credits through Q3 2014), Corey referenced the state's reliance on biodiesel for "future reductions of toxic diesel particulate matter."
Janea A. Scott, Commissioner, California Energy Commission (CEC), gave an update on funding under the agency's Alternative and Renewable Fuel and Vehicle Technology Program. Citing that biodiesel is making tremendous gains, she highlighted four projects in process with funding from this CEC program for construction or expansion: Crimson Renewable Energy, Community Fuels, Buster Biofuels, and Springboard Biodiesel.
The second regulatory panel included Dr. Douglas Hepper, Chief, Meat, Poultry & Egg Safety Branch, California Department of Food and Agriculture (CDFA), who discussed his critically important Rendering Enforcement Program (REP), specifically the details of the new Inedible Kitchen Grease (IKG) regulations that are now in place to help stop the rampant and damaging grease theft suffered by the biodiesel industry.
The agency director of the CDFA's Division of Measurement Standards (DMS), Kristen Macey, gave a thorough overview of her agency's work. She details the programs and issues affecting biodiesel, including signage, labeling, Type Evaluation of fuel dispensers, the variance program for retail sales of blends above B20, and new legislation to include definitions for alternative fuels.
Steven Scott Nicholls, Business & Energy Programs Specialist, State Energy Coordinator, USDA, Rural Development detailed a host of programs with potential to inform and assist the state's biodiesel industry.
Featured speaker, Joe Jobe, CEO, NBB, motivated attendees by showing before and after aerial photographs, some his own, of the devastation wrought to beautiful farms and pristine areas by the extraction of oil (fracking wells, surface pits, toxic tailings ponds, etc). He stressed the importance of countering petroleum industry claims, including those from a still-not-refuted 2013 report from NERA Economic Consulting study arguing that the EPA's Renewable Fuel Standard (RFS) would lead to fuel supply disruptions, increase the cost of diesel by 300%, reduce GDP by $770 billion and reduce work or take home pay by $580 billion.
Citing the EPA's approval of an RFS application for biodiesel from Argentina under an expedited process and the risk to the entire RFS program from Republican control of key committees, he called on the biodiesel community to remain vigilant by building relationships with new lawmakers and letting them know the facts about our industry and its ability to continue to exceed RFS volumes.
The afternoon session included a panel focusing on feedstocks and innovation. Roger Wolf, Director of Environmental Programs & Services, Iowa Soybean Association, talked about the important success of STAARS, a farmer-led program using science to improve farm profitability, energy efficiency, and environmental performance.
Shashi Menon, Managing Partner, EcoEngineers, educated attendees about the new simpler EPA Quality Assurance Program under RFS, specifically on Q-RINs, which include an affirmative defense against invalid transfer and use.
Clayton Vaughan, Vice President of Sales and Supply Chain, Corn Oil One, discussed the issues related to distillers corn oil, which is being extracted at about 90% of the roughly 200 ethanol plants in the U.S. He discussed new technologies that allow for higher extraction rates and refinement, making it even more valuable as a low CI diesel replacement fuel feedstock under LCFS.
As part of the panel entitled Clean Fuel Standards: Biodiesel's Key Role in States and in the Region, Simon Mui, Director, California Vehicles and Fuels, Energy & Transportation Program, NRDC, presented detailed updates on the status of clean fuel policies along the Pacific Coast, including California, Oregon, Washington, and British Columbia. He made the case that organized oil company opposition to these programs is countered by strong, broad-based support for clean energy that addresses the problem of climate change. Mui cited a February 2015 Promotum Report showing that the alternative fuel market share can triple to 20% by 2025, meeting all the requirements of our state's LCFS program and more!
Gavin Carpenter, Director of Sales and Marketing, SeQuential Pacific Biodiesel, discussed several Oregon programs.Oregon's Clean Fuels Program, to lower the carbon content of transportation fuels by 10% over a 10-year period, was implemented in 2014 and ideally will be continued with a finalized regional approach to carbon intensity methodology that aligns with California's LCFS. The state's Tax Forgiveness Program, which waives $0.30 of the state road tax for B20 and higher, is a very successful program that has opened retail market at 61 B20 locations.
Sharing an intimate knowledge of biodiesel policies and programs, which are in place in all but one state, Shelby Neal, Director of State Governmental Affairs, National Biodiesel Board, discussed the relationship between policy and production, and ended with the strong message that . . . he is bullish on California!
CBA wishes to thank the following for their generous:National Biodiesel Board, REG (Gold); EcoEngineers (Silver); and Biodico, The Jacobsen (Bronze).
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Conference presentations are available on the About page of our website (scroll down).
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Biodiesel Industry Gets Last Word at ARB Board Hearing on
LCFS Readoption and ADF Regulation Adoption
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ARB headquarters in the Cal/EPA Bldg
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On February 19th, the California Air Resources Board (ARB) held the first of two much-awaited board hearings on the readoption of the Low Carbon Fuel Standard (LCFS) and the adoption of the Alternative Diesel Fuel (ADF) regulation.
The biodiesel industry, represented by Shelby Neal, Director of State Governmental Affairs for the National Biodiesel Board (NBB), Celia DuBose, Executive Director of the California Biodiesel Aliiance (CBA), and the state's major producers gave testimony, along with environmental NGOs and members of the alternative low carbon fuels sector, in support of both.
LOW CARBON FUEL STANDARD READOPTION
LCFS readoption proponents, the majority of the 50 who spoke, sited the program's many successes in lowering carbon emissions, displacing petroleum, creating jobs, diversifying the fuel pool, and providing a model that is already being exported to other states and countries.
Board Chair Mary Nichols talked about how well the regulation has been working and said she was disappointed in the comments from oil industry representatives who seemed to be even more opposed to the program than in the past.
An article in the Sacramento Bee the next morning, which focused on the petroleum industry's perspective, gave the biodiesel industry the last word. It ended with these statements from Shelby Neal: "Ten years ago, you were buying biodiesel by the jar. Now the industry is creating 1.4 billion gallons a year of the low-carbon fuel. We're here today, and we're affordable."
ALTERNATIVE DIESEL FUEL REGULATION ADOPTION
During the afternoon session, about a dozen proponents, and no opponents, gave public comment on the value of biodiesel to the state and thanked the agency for their approach to the proposed ADF regulation. In urging adoption of the regulation, under which biodiesel would be the first fuel to be regulated, our industry expressed appreciation to ARB staff for working with us over the years to come up with a framework that allows biodiesel to move forward while upholding state law for regulating the one criteria pollutant of concern in higher blends. The proposed rule allows a blend of B10 to be sold year-round if it has a cetane level of 56 or greater, but only up to B5 in the high ozone summer season if it has a cetane of 56 or less (cetane levels correspond to NOx emissions).
The proposed regulation provides exemptions for light and medium duty fleets and for those with 90% New Diesel Technology Engines (NTDE) up to B20. It has an expected sunset date of 2023, when the use of NTDEs is expected to reach 90%, and a review process that will provide for data on actual vehicle miles traveled as fleets turnover to NTDEs. CBA looks forward to continued discussions with ARB staff about their willingness to discuss flexibility for higher blends, as expressed at the hearing, and to the adoption of the best possible final ADF regulation.
We appreciated ARB staff's recognition, and that of the NGOs and members of the low carbon fuels sector, of the importance of maximizing biodiesel's health benefits, especially its reductions in toxic diesel particulate matter. Our industry comments repeatedly emphasized our desire to continue to bring that and other of biodiesel's many benefits to California, especially to communities that are economically disadvantaged and suffer disproportionately from diesel emissions-related diseases and to do this by creating jobs in those areas, which is where many of our plants are located.
At the end of the day, ARB board member Sandra Berg expressed her appreciation for the cooperative process between ARB and the biodiesel industry that resulted in no oral comments opposing the proposed regulation.
No vote was taken. The ARB board will hold a second hearing this summer for a vote on the two regulations. A 15-day rule will be issued before then, which will allow for public comment. The links for all related documents for both issues areas are in the Policy section below.
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Biofuels Initiative Launched to Secure Funding from
Cap & Trade Proceeds
The California Biofuel Initiative, a proposal to allocate $210 million from Cap and Trade auction proceeds to low carbon biofuels, has built an impressive list of supporters since it was launched a few months ago. The supporting coalition, which includes biofuels producers, industry associations, and other stakeholders, has come together to make the case that low carbon fuels are available now and must be aggressively scaled up if Governor Brown's goal of reducing petroleum use in the state by 50 percent by 2030 is to be met.
An important element of the proposal includes not just concern about reaching the climate change goals of AB 32, but also that biofuel production and infrastructure should be encouraged in disadvantaged communities as put forth in SB 535. That law calls for stimulating employment and economic improvement in those communities as defined by CalEnviroScreen.
The funds would be split equally among three biofuel types (diesel alternatives, gasoline alternatives, and biogas/syngas) based upon stimulating (1) California-based biofuel production; (2) the low carbon intensity of biofuels, and (3) the benefits to disadvantaged California communities. Each category would tailor spending on production and infrastructure based on the needs of their biofuel type.
CBA has hired Sacramento lobbyist and biodiesel specialist, Louie Brown of Kahn, Soares, and Conway, LLP, who is leading weekly meetings with the Biofuels Coalition partners to develop the legislative strategy required to secure funding through the Cap and Trade program.
View the proposal and the current list of supporters here. An informational video is also being put together to show the breadth and depth of California's biofuel and renewable transportation industry. Any signatories are welcome to submit video clips for inclusion. The draft "CA Biofuels Montage" can be seen at https://www.youtube.com/channel/UCByKEIwaO4WLjqPIHjzeWyw.
For further details and to add your organization's name as a signatory to the Biofuels Initiative, call Russ Teall at 805-689-9008 or email him at [email protected].
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(CALSTART)
Industry Urges State Officials to
Go Further, Faster on Climate and Fuel Standards
Temporary low gas prices are no reason to slow push toward fuel diversity, security
 Sacramento, Calif. - Feb. 3, 2015 - Industry leaders met today to discuss the state of low-carbon fuels in California at the CALSTART annual Clean, Low-Carbon Fuels Summit, where the issue of low gasoline prices set the tone for the event."OPEC is cutting prices to keep competition from taking root - competition from companies like we have here today," said John Boesel of CALSTART. "To the extent low-carbon fuel companies, fleet operators and policy makers can work together to keep the clean fuels market humming, then we'll no longer be strapped into the oil price rollercoaster."
Oil prices have been dropping since November, due in part to sustained production by the Organization of the Petroleum Exporting Countries (or OPEC). However, most of the oil producers have stated a strong desire to cut production and increase prices. Just last week, an OPEC official claimed that oil prices could rebound even higher than in 2008, when prices spiked to more than $4 per gallon.
"Californians need energy choices," said Rodger Schwecke, vice president of customer solutions for SoCalGas. "Cleaner low-carbon fuels, such as natural gas, are an abundant and affordable energy source that can compete with petroleum fuels right now. They can also help California achieve its clean energy and greenhouse gas goals while simultaneously supporting a strong economy."
In the first two years the Low-Carbon Fuels Standard (LCFS) was in effect, low-carbon transportation fuels displaced more than two billion gallons of gasoline and 77 million gallon-equivalents of diesel, according to the Institute of Transportation Studies at the University of California, Davis.
"It's far too easy to get complacent when fuel prices dip," said Graham Ellis, SVP, Fuels and Business Development, Solazyme. "California has led the way in both carbon reduction and fuel quality for decades. Standards like the LCFS and AB32 continue to set the bar globally for innovation in clean energy and sustainable advanced fuels."
Electric vehicles are selling faster than hybrids did when they were at the same point in their production cycle. According to projections, by 2030, EVs could displace up to 3.3 billion gallons of petroleum a year in California alone.
"It's easy to forget the pain at the pump, but today's fuel prices shouldn't stop us from investing in alternatives," said Caroline Choi, Southern California Edison, Vice President of Energy and Environmental Policy. "Last year, California surpassed 100,000 plug-in car sales. We are well on our way, but we still have a long way to go and need policies like the Low-Carbon Fuels Standard to keep the momentum going."
And California is not alone. Oregon, Washington and British Columbia have also pledged to reduce the carbon intensity of their fuels. A new study shows that - including California's LCFS - these targets (adopted or proposed) can replace more than a quarter of the gasoline and diesel used by vehicles in the Pacific Coast region with low-carbon fuels by 2030.
"Low-carbon fuels produced here in California provide insurance and confidence," said Russ Teall, President and Founder of California biofuel producer Biodico. "We're creating jobs and economic benefits in the areas of California that need them most. And an LCFS that looks beyond 2020 could give us the certainty we need to continue to invest in our industry and our community."
More than 150 individuals representing California's legislature, clean fuels producers and consumers met in Sacramento to discuss opportunities and challenges in clean fuel commercialization and usage. CALSTART and its partners and members recognize that policy drivers remain important and they continue to be in flux. The summit addressed not only LCFS but also the AB 32 Cap and Trade Program and longer-term targets for climate and clean fuels.
About CALSTART
CALSTART and its 140+ member companies are dedicated to expanding and supporting a clean transportation industry that cleans the air, creates jobs and economic opportunities, reduces greenhouse gas emissions and secures our transportation energy future.
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(Senate President pro Tempore Kevin de Le�n)
California Climate Leadership Package Announced
Tuesday, February 10, 2015
Historic Legislative Proposals Power New Clean-Energy Economy
SACRAMENTO - Today, several members from the California State Senate introduced a package of legislative proposals that will strengthen California's leadership in powering a new clean-energy economy. The proposals include historic benchmarks for pollution reduction, energy efficiency, and petroleum use that will spur innovation and investment and maintain California's lead in creating jobs in the advanced energy sector. This will be the first series of bills introduced by Senate Democrats to combat climate change and preserve the environment.
Details of today's proposals along with bill language, charts, articles, and statements from a broad coalition of supporters are online here: http://focus.senate.ca.gov/climate.
SB 32 (Pavley) sets an overarching climate pollution reduction target of 80 percent below 1990 levels by 2050. Setting clear, achievable climate pollution reduction targets in law and identifying priorities to guide implementation will provide critical accountability, as well as certainty to businesses investing for the long term in California. This commitment will also secure fees paid by polluters for the foreseeable future, in effect stabilizing revenues from our cap-and-trade system that go into energy efficiency, cleaner transportation, and investing in disproportionately impacted communities.
SB 350 (De Le�n-Leno) executes on Governor Jerry Brown's bold vision mentioned in this year's State of the State to reduce petroleum use by 50%, have 50% of electricity come from renewable sources, and increase energy efficiency in all existing buildings by 50% -- all by the year 2030. State agencies and energy providers are already making steady progress towards these goals and setting these new "Golden State Standards" will allow them to marshal resources more effectively so their efforts can benefit all Californians. The state has a proven record of setting ambitious climate goals and growing our economy. These new targets will create incentives to invest in technologies and infrastructure that create a sustainable future for our communities and expand the market for clean-energy industries.
Keeping the focus on building the new economy of the future, SB 189 (Hueso) proposes a high-level expert Committee to advise and inform state clean energy and climate actions that ensure maximum job creation and economic benefits to all Californians across the state. SB 185 (De Le�n) ensures that the state's largest public pension funds also keep their focus on the future and lead by example by moving its investments beyond coal. With coal power in retreat, and the value of coal dropping, massive state portfolios should be moving to lower carbon investments and reflecting the values of the next generation.
"This climate leadership package sets the foundation for a clean-energy economy to flourish," Senate President pro Tempore Kevin de Le�n (D-Los Angeles) said. "Clean tech companies in California are creating more jobs and investing more money than competitors in any other state, and these policies will keep this momentum going and expand its reach."
Senator Fran Pavley (D-Agoura Hills), who authored the successful laws the Senate climate package builds upon, says, "We must send a strong signal to the thousands of businesses already investing in job creation through pollution reduction that the state will stand with you to continue our long-term growth. Building on the success of our existing policies will create even more jobs and save families and businesses money on their energy and fuel bills, while also reducing pollution to ensure a cleaner and healthier environment for all."
"Our state has exerted a leadership role in creating climate change policies that foster economic growth and improve public health. These are necessary steps for a state that values innovation and strong environmental stewardship. We are building the framework for promoting alternative energy and a vibrant, sustainable future." Senator Bob Wieckowski (D-Fremont), Chair of the Environmental Quality Committee.
"Senate Bill 189 will tap into California's leading innovators to assist in creating jobs through environmental stewardship," stated Senator Ben Hueso (D-San Diego). "We will develop a model that will benefit Californians and future generations."
"Senate President pro Tem Kevin de Le�n is showing real leadership with this proposal," Los Angeles Mayor Eric Garcetti said. "Reducing carbon pollution is a top priority for Los Angeles, and I look forward to working with the Senator to advance the state's greenhouse gas reduction goals in ways that will benefit our environment, our economy and our most at-risk residents."
Tom Steyer, President and Founder of NextGen Climate: "I join a generation of California business leaders and job creators in applauding Senate President Kevin de Le�n and his colleagues for introducing landmark legislation to ensure California is reaching higher and building on its global leadership in meeting the climate challenge. These are achievable policy proposals that will create good-paying green jobs here in California, mitigate the impact of climate change, and leave a cleaner, safer, more stable world for the next generation. California has long been a leader when it comes to tackling climate change-spearheading some of the nation's most groundbreaking climate change solutions and energy efficiency laws. At a time when our state is faced with the choice between moving backwards by accepting the fossil fuel industry's status quo or embracing a clean energy future for our state, this new legislative package includes commonsense proposals that will move California forward. Climate change is the most pressing issue of our generation, and I will continue to support the important work being done by our leaders in Sacramento. There's no question California will continue to set the example for our nation and the world in creating the advanced energy economy that our children deserve."
"Creating a vibrant California economy will depend on implementing smart, far-sighted policies to confront the crisis of climate change and strengthen California as a global leader in renewable energy," President of the Los Angeles Business Council Mary Leslie said. "The legislation being unveiled today aligns closely with the goals of the LABC in Los Angeles: to promote sustainability, create long-term jobs for the future, and ensure that all of our communities share in the benefits."
Shannon Baker-Branstetter, Policy Counsel for Consumers Union said, "Longer-term planning of the trifecta of renewable energy, energy efficiency, and reducing oil consumption exemplifies California's leadership and lays the foundation for a healthier future with more consumer choice and consumer power."
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