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California Biodiesel Alliance News

California's Biodiesel Industry Trade Association  


January 2016     

In This Issue

We are pleased to begin this issue by announcing that Darling Ingredients has joined CBA as a full voting member. We welcome Michael Rath as the company's representative on CBA's board of directors.
CBA kicked off the new year with news to members that included summary documents of  the Alternative Diesel Fuel (ADF) and the re-adopted Low Carbon Fuel Standard (LCFS)
regulations, which both became effective January 1, 2016. Please read the articles on CBA's Home page (which have links to guidance documents and FAQs) to learn how these regulations will affect your business operations in California. 
Time to register for CBA's February 24th conference! Our one-day event is packed with must-know information about California's stabilizing policy environment for biodiesel. The first panel, described below, begins with a bang, bringing exciting developments on California Biofuels Cap & Trade Initiative coalition efforts  to secure funding from auction proceeds.
As this newsletter is released, the annual National Biodiesel Board (NBB) conference has just wrapped up. We are happy to bring positive national news of biodiesel industry growth and expected stability due to a favorable Renewable Fuel Standard (RFS) rule and a two-year retroactive reinstatement of the $1-per-gallon blenders tax credit. Also, national recognition of West Coast carbon reduction policies was highlighted by NBB's honoring of Environmental Entrepreneurs, the Environmental Defense Fund, and the American Lung Association in California with the 2016 Climate Leader Award at their event. See details on NBB's Facebook page.
There's more in the Industry News and Policy sections, including information about some member companies; California Energy Commission grant funding updates; industry comments on new LCFS pathway applications; and details on the federal tax credit and Argentinian biodiesel imports.
To view back issues of this newsletter and CBA Email Alerts 

click on the "View CBA Email Newsletter Archive" button on our Home page.   
California Biodiesel Conference 
Begins with a CA Biofuels Cap & Trade Initiative Bang!

All New Conf Logo
February 24th, Sacramento

CBA's fifth annual conference will  begin with a panel on the California Biofuels Cap & Trade Initiative that includes representatives from the biofuels sectors involved in this exciting coalition effort initiated by CBA in early 2014. Learn about the progress to date, including the inclusion of $25 million from the Greenhouse Gas Reduction Fund (GGRF) for in-state biofuel facility expansion and the development of new plants in the Governor's 2016-17 budget. Get the latest on our targeted activities in support of this effort for the 2016 legislative session.
9:00 - 10:30:    The California Biofuels Cap & Trade Initiative: What Lies Ahead? 

Moderator: Louie Brown, Partner, Kahn, Soares, Conway. LLP
  • Russ Teall, President & Founder, Biodico Sustainable Biorefineries: Biodiesel's Role in the Biofuel Initiative

  • Julia Levin, Executive Director, Bioenergy Association of California: Biogas from Organic Waste - Potential Production and Policy Drivers in California
  • Duncan McFetrich, Consultant: Ethanol's Role in the Biofuel Initiative
  • Ryan Kenny, Senior Public Policy and Regulatory Affairs Advisor, Clean Energy: The Latest on CA Public Policy for Natural Gas Fueling Infrastructure and Vehicles
  • Johannes Escudero, Executive Director, Coalition for Renewable Natural Gas: Update on Federal Policy & National Potential of Renewable Natural Gas 
The California Biofuels Cap & Trade Initiative coalition came 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.


 Join Us to receive a member discount!

(National Biodiesel Board)
West Coast Market Focus Proves Successful for Biodiesel

In part because of the success demonstrated in California with its low carbon fuel standard (LCFS), both Oregon and British Columbia have also adopted low carbon transportation policies, and they are setting precedent for the rest of the world.

Nearly a decade ago, California embarked upon a landmark climate initiative commonly referred to as AB 32. The law requires greenhouse gas (GHG) emissions reductions to 1990 levels by 2020 - a reduction of approximately 15 percent below expected emissions in a "business as usual" scenario. AB 32 includes a number of ambitious climate programs that call for reductions in every sector of the economy. The state's low carbon fuel standard (LCFS) focuses on transportation.

"Over the past four years of the LCFS, the California biomass-based diesel market has grown from 10 million to 200 million gallons," said Don Scott, director of sustainability at the National Biodiesel Board. "This shows how successful carbon policies can be at spurring growth in clean fuels like biodiesel."

In part because of the success demonstrated in California, both Oregon and British Columbia have also adopted low carbon transportation policies, and they are setting precedent for the rest of the world. This means that approximately 5 billion gallons of diesel are now under low carbon fuel policies on the West Coast.

NBB has concentrated significant resources over the past eight years to ensure that biodiesel participates in these programs. The technical data developed by NBB played a significant role in the determinations by the California Air Resources Board confirming that biodiesel reduces GHG emissions by 50 to 80 percent compared to petroleum diesel. This makes biodiesel the lowest carbon liquid fuel available in today's marketplace.

"Biodiesel is the most sustainable fuel on the planet," Scott said. "But quantifying the precise carbon intensity of fuel from varying feedstocks, geographies, and process technologies does not happen without significant investment in data and scientific analysis. Lifecycle assessment is a complex undertaking that required participation from diverse stakeholders such as the California Biodiesel Alliance, our friends in the environmental community, and NBB members."

On a national scale, biomass-based diesel has the potential to reduce carbon emissions by 40 million tons annually, or the equivalent of removing more than 30 million passenger cars from the road.

(National Biodiesel Board)
CARB Updates GHG Inventory Methodology

By Don Scott, Director of Sustainability
How do we know how much greenhouse gases (GHG) are emitted each year and where they come from?  The USEPA publishes a periodic Inventory of GHG emissions and sinks.  Their latest report is available here.  Emissions are reported from various kind of greenhouse gases including carbon dioxide, methane, nitrous oxide, and others.  Net emission are generally reported in units of CO2 equivalents, where the global warming potential of each individual gas is weighted on the basis of the global warming potential of carbon dioxide over a 100-year period.  Emissions are reported from various sectors including transportation, electricity generation, industry, agriculture, residential, and commercial. The largest and most significant source of GHGs is the combustion of fossil fuels, which releases carbon dioxide to the atmosphere.  The carbon dioxide from burning biomass is considered "biogenic" and is excluded from net inventory of emissions.  Biogenic carbon can be included in the inventory if there is a change in land use where carbon is released into the atmosphere or sequestered into soils, plant material, or landfills.  The biogenic carbon from burning biodiesel in a vehicle is excluded from the inventory.  The fossil energy emissions of producing biodiesel may be captured in the industrial and agricultural sectors.
Individual states also publish inventories of their emissions.  Last week, the California Air Resources Board hosted a workshop to present proposed changes to their inventory methodology.  In large part, their inventory will be consistent with methods used by USEPA and the Intergovernmental Panel on Climate Change (IPCC). Slides from the workshop are online here.
While biogenic carbon is excluded from IPPC protocol for GHG inventories, some jurisdictions report biogenic emissions as an informational item.   CARB proposes to do this for biodiesel going forward.  In the 2015 and previous inventories, CARB did not report any emissions for biodiesel or renewable diesel in the transportation sector.  CARB proposes to change this. CARB recognizes that biodiesel and renewable diesel will make up increasing shares of the transportation sector.  Continuing to report GHG emissions from transportation as if all diesel fuel in the market came from fossil fuels would be over-counting the net GHG emissions.  
The impact of this is that biodiesel will reduce the net GHGs reported in the transportation sector in California and nation-wide. 

(National Biodiesel Board)
US Biodiesel Consumption 
Hits Nearly 2.1 Billion Gallons in 2015

January 25, 2016
U.S. consumers used a record of nearly 2.1 billion gallons of biodiesel in 2015, reducing America's carbon emissions by at least 18.2 million metric tons, according to new U.S. EPA data released as the industry kicks off its 2016 Biodiesel Conference & Expo.

Biodiesel industry leaders said the year-end figures demonstrate biodiesel's rising popularity and its continued success as America's first and only EPA-designated advanced biofuel to reach commercial-scale production nationwide.

"We're seeing it take hold across the country," said Joe Jobe, CEO of the National Biodiesel Board, the industry's U.S. trade association. "Consumers are seeking out cleaner alternatives to fossil fuels and they see biodiesel as a high-performing, cost-competitive alternative to petroleum diesel. These numbers also show without question that the renewable fuel standard (RFS) is delivering significant volumes of advanced biofuel to the American people. They prove that the RFS is absolutely working."

Jobe continued, saying, "Biodiesel is still a young industry, but it is becoming a mainstream American fuel that's having a real impact in helping us cut pollution, create jobs and diversify the fuels market."

Made from an increasingly diverse mix of resources such as recycled cooking oil, soybean oil and animal fats, biodiesel is a renewable, clean-burning diesel replacement used in existing diesel engines. It is the first and only commercial-scale fuel produced across the U.S. to meet the EPA's definition as an advanced biofuel-meaning the EPA has determined that it reduces greenhouse gas emissions by more than 50 percent when compared with petroleum diesel.

According to the data, fuel companies reported producing 2.09 billion gallons of biodiesel in 2015, up from about 1.97 billion gallons in 2014. 

The figures, however, continue to show a troubling trend in which imports are increasingly flooding the U.S. market and undercutting U.S. production. According to the data, domestic production remained flat at about 1.42 billion gallons, compared with about 1.47 billion gallons in 2014 and 1.50 billion gallons in 2013. Meanwhile, imports rose from 510 million gallons in 2014 to an estimated 670 million gallons in 2015, a jump of more than 25 percent. 

"While the overall numbers are positive, we are increasingly seeing subsidized, predatory imports undercutting U.S. production-in part by taking advantage of U.S. policies aimed at building up the domestic industry," Jobe said. "This is exactly what we have been warning would happen, and it will continue until we take steps to level the playing field, including by reforming the biodiesel tax incentive as a domestic production credit." 

NBB has urged Congress to reform the $1-per-gallon biodiesel tax incentive from a blender's credit to a producer's credit. Under the existing blender's structure, biodiesel that is produced overseas and blended in the U.S. is increasingly taking advantage of the incentive, sending U.S. tax benefits to foreign producers. Most of the imports already receive valuable incentives overseas, while U.S. companies are typically barred from taking advantage of those overseas incentives. 

"We welcome competition but U.S. companies can't fairly compete against foreign companies that are double-dipping on overseas and U.S. incentives while not letting U.S. producers compete in their domestic markets," Jobe said. "This reform is a simple fix that would appropriately focus U.S. tax dollars on creating jobs and stimulating economic development here at home instead of overseas."

While the threat of rising imports continues, Jobe said industry optimism is being fueled by stronger policies implemented late last year. In November, after several years of damaging delays, the EPA finalized new biomass-based diesel standards under the RFS requiring 1.9 billion gallons in 2016 and 2 billion gallons in 2017. Additionally, in December, Congress reinstated the biodiesel blender's tax incentive through the end of the year. It had lapsed in 2015.

The reported volumes are made up mostly of biodiesel but also include renewable diesel, a similar diesel alternative that uses a different production technology. The data show volumes of biodiesel (1.58 billion gallons) and renewable diesel (510 million gallons) reported under all categories of the RFS, the federal policy requiring increasing volumes of renewable fuels to be incorporated into the U.S. fuel supply. The data can be found here on EPA's website. NBB represents both biodiesel and renewable diesel companies, and the fuels together comprise the vast majority of advanced biofuel produced in the U.S.


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(BIODIESEL MAGAZINE) Standing On Its Own 2 Feet

Despite less than ideal economic and policy conditions, the biodiesel industry continues to move forward, and not just one project at a time. Here are several plants that have come on-line in late 2015 or are preparing to start operations in 2016.

By  Anna Simet  | January 19, 2016

From the outside, it may seem as though the biodiesel industry had a tough year.  An amalgamation of economic and political factors have impacted most biofuel sectors, perhaps the most obvious of hindrances being plummeting oil prices. 

Diesel costs fell throughout 2015, recently reaching a six-year low, and are forecast to fall even further in 2016. The U.S. DOE's Short-Term Energy Outlook issued in December projected the average price of diesel to settle at $2.71 for 2015, and $2.67 in 2016. A recent OPIS report cited B100 prices at $3.37, falling from an average of $3.55 per gallon in summer 2015.

To compound matters, the biodiesel tax credit expired Dec. 31, 2014, for the fourth time in six years. At press time, the U.S. House and Senate passed a two-year retroactive extension of the $1-per-gallon blender credit. Two weeks prior, a restructured version of the tax credit as a producer incentive was introduced in Congress. Producers were hopeful this would pass but at the last minute the incentive was reverted back to a blender credit, voted on, and passed. The credit is now retroactively in effect from Jan. 1, 2015, through Dec. 31, 2016. 

And finally, the U.S. EPA's renewable fuel standard (RFS) renewable volume obligation (RVO) numbers were woefully late, stirring up investor uncertainty and stymieing development. The highly anticipated numbers were released Nov. 30, 2015, and the volumes for biomass-based diesel were higher than the spring proposal - 1.63 billion gallons for 2014, 1.73 billion gallons for 2015, 1.9 billion gallons for 2016, and 2 billion gallons for 2017. Good news overall, years late, nonetheless.

Despite these hurdles, a closer evaluation of the U.S. biodiesel industry and feedback from producers and developers tells a bit of a different story. Below is a cross section of developing projects to watch in 2016.

2 Biodico Projects

Roughly two decades ago, Russ Teall, founder and president of Biodico, launched a company that focused on modular, multifeedstock biodiesel plants called Biodiesel Industries. After prototypes, pilots and some work with the U.S. Department of Defense and U.S. DOE, the company built its first commercial plant in 2000, and subsequent plants in Australia, Colorado and Texas, all of which were sold off. "We designed, built, operated and then sold to our strategic joint partners once everything was up and operating correctly, in order to fund the next plant," Teall says, adding that, considering the unique, proprietary technology of the plants the company builds, Biodico decided that its two latest projects, one recently completed and the other under development, will remain owned by the company.

The first project, Biodico Westside in California's San Joaquin Valley, is a partnership between Biodico and Red Rock Ranch. The 20 MMgy plant was completed in the fall, with the first runs of biodiesel made in early December. "The next facility will be at the Naval Base Ventura County, a joint venture we started with the U.S. Navy in 2002," Teall says. "It initially focused on biodiesel, but now focuses on all biofuels and bioenergy. We'll be building a biodiesel facility there similar to the one up in west side, supported by renewable, combined-heat-and-power onsite resources."

Similar to the design of Biodico Westside, the 10 MMgy Naval Base Ventura County plant - a partnership with the U.S. Navy, and supported by the California Energy Commission - will gasify dry biomass, mostly prunings from local orchards and vineyards, and also utilize anaerobic digestion for wet biomass such as crude glycerin, rotten fruits and vegetables, to produce heat and power consumed on-site, according to Teall. The location is already home to the Biodico Technology Test Site, which was built with a CEC grant and is the result of a five-year joint research and development project between Biodico and the Navy. One facet of the partnership is training Navy engineers to learn ASTM standards, Teall says, as well as what might go wrong in the process causing the fuel to fail to meet them.  

And that is where the most unique part of Biodico's process comes into play, according to Teall. "A lot of the testing that's involved is time-consuming - running the gas chromatograph, it takes 45 minutes. The conclusion we've come to is that, to make on-spec biodiesel, there are two ways to do it. One is to test the batch when it's done, and that might tell you that on Monday morning you made a mistake, but the other is to divide the process into a series of steps, and to test at the end of each portion of the process. By doing that, you're not wasting time finding out at the end of the day that you did something wrong in the morning," Teall says. 

Biodico has implemented the latter option-real-time testing. "If you want to know, at end of the transesterification step, whether you have any residual glycerin, mono-, di- or triglycerides, you run a GC test and 45 minutes later it tells you," Teall says. "We can tell exactly the state of the reaction at every single step-a series of sensors and protocols that give us that. We developed that with the U.S. Navy, and it's incorporated into the new facility." The next step is incorporating real-time sensing into automation.

Real-time testing differentiates the company as a biodiesel producer, Teall says, and renewable energy is a second distinguishing factor. "In 2004, we got a U.S. EPA award for using landfill gas to run our boilers, our first prototype biodiesel plant was run by small-scale solar ... it's a continuation of that focus on renewable energy to create renewable fuels." 

On challenges with launching two projects in today's economic climate, Teall says there were not many surprises. "It was our fifth plant, and we have a focus on getting things done thoroughly and quickly. We obtained all of the necessary permits, networked with all of the agencies, and the fact that it was my area of practice helped quite a bit in understanding what the rules are and what the agencies are looking for, and being able to give it to them."

Teall says he doesn't worry so much about today's low diesel prices. "The single largest factor in biodiesel production is feedstocks and their cost, and that has to be addressed right up front," he says. "We need to zero out all of the subsidies and incentives, because if your business is not stable without subsidies and incentives, then you're exposing your investment to a lot of risk-people tend to forget that." 

Lakeview Biodiesel LLC
When Lakeview Energy was considering purchasing a shuttered 10 MMgy biodiesel plant in Moberly, Missouri, it recognized it might appear outside of its interests, as the company has investments in agribusiness, wind energy and two ethanol plants located in Merrill, Iowa, and Coshocton, Ohio. But the prospect of diversifying its biofuel portfolio with biodiesel, the attractive characteristics of the Moberly site and its proximity to the company's ethanol plants equated to an opportunity that was just too appealing to pass up, according to CEO Jim Galvin. The plant retrofit is moving full steam ahead, he says, and plans are to bring it online in Q2 2016. "I just recently visited the site, and right now, there is probably more equipment outside than inside," he says. 

At Moberly, the company will deploy a multifeedstock-capable transesterification process, using various fats, oils and greases, potentially including distillers corn oil from the company's ethanol plants. "The geography of this plant was one of the big things for us," Galvin says. "We're almost equal distance between Kansas City and St. Louis, where there are good local markets for our product. A project we're working on right now is access to rail - we're working with the local Missouri railroads to see what our options are there, to enable us to serve other local markets."

Raw material availability was a key factor in the decision to purchase the plant and move forward with the retrofit, Galvin says. "There's a good supply chain there. And one of the things we looked at was the potential for our [existing] plants - Plymouth or Three Rivers - to be able to supply corn oil, and whether it would be cost-effective for us. That's advantageous to this particular location."

Another aspect Lakeview evaluated was what kind of local support the project would have. "It was a very important first step," Galvin says. "With any kind of stressed asset purchase, there can always be issues, so this was something we looked at before we made the investment. We've gotten very good support from the local economic development and city councils, and we're recruiting staff at the moment and are in the interviewing process, and have taken on a number of people already." 

Galvin says diesel prices were considered but had little impact on the decision to purchase the Moberly plant, as the company makes long-term investments. "If we made decisions based on the short term, we'd never get anything done-the market moves so quickly," he says. "Fundamentally, we looked at this and believe there's a bit of a consolidation play to take place in the biodiesel industry. Our plan is that if this goes successfully, we'll look at a number of other acquisitions in the biodiesel sector. We're not looking at this as a sole, stand-alone project."

Duonix Beatrice

When Irving, Texas-based Benefuel Inc. brought to market its novel, patented Ensel technology, a catalytic process capable of refining renewable, high free fatty acid (FFA) feedstocks into a variety of products, it snagged the interest of Flint Hills Resources LLC, a leading refining, chemicals, biofuels and ingredients company. Considering the interests and experience of both companies, the partnership made perfect sense. "Flint Hills Resources is a leader in the transportation fuels industry, and has a long history of blending biofuels," says Jeremy Bezdek, vice president of biofuels and ingredients at Flint Hills Resources.

In fact, the company has been blending ethanol into gasoline since the 1990s. "We are continually looking for ways to innovate and optimize our transportation fuels business and further create value for our customers and society," Bezdek says. "That's why, in 2010, our company purchased its first two ethanol plants in Iowa. Since then, we have added an additional five ethanol plants to our biofuels fleet making Flint Hills Resources the fifth largest producer of ethanol in the U.S."

In 2011, FHR purchased the Beatrice, Nebraska, biodiesel plant out of bankruptcy. The same year, it made an equity investment in Benefuel, a company that Bezdek says has developed a technology that could dramatically improve the cost-effectiveness of biodiesel production. "We believe the Benefuel technology has the potential to expand the range of low-cost feedstocks used in biodiesel production," he says. "The Ensel technology process combines esterification of FFAs and transesterification of triglycerides into a single process step, which is a long-standing technology goal of the biodiesel and oleochemical industries."

Resulting from FHR's investment in Benefuel is the Beatrice plant, a joint venture titled Duonix Beatrice, which will represent the first commercial use of the Ensel technology. "Flint Hills Resources has been hired by Duonix to be the operator and employer," Bezdek explains.

Duonix Beatrice will be feedstock-flexible, able to run on distillers corn oil, used cooking oil and animal tallow, and, of course, soybean oil. "Feedstock flexibility will allow the plant to purchase lower-cost feedstocks," he says, adding that the types purchased will depend on the market. 

Progress continues at the Duonix Beatrice plant, with a start-up planned in early Q1 2016, Bezdek says. "In preparation for the planned start-up, we have begun plant commissioning including conducting safety checks on plant equipment. These checks include tests on piping integrity, and safety systems designed to maintain balance in industrial systems."

On project challenges, Bezdek says Beatrice marks the first time FHR has built a plant from nearly the ground up. "That means we couldn't draw on past experience as a guide," he says. "It began with a clean slate." 

And part of working from a clean slate meant putting together a new-and right-team, which will include about 50 people when the facility is operational. "We are happy with the results," Bezdek says. "We have a talented team of individuals, some drawn from within Flint Hills Resources, some from Benefuel, and some drawn from elsewhere, with extensive experience. They have worked hard to get the plant up and running."  

Another hurdle faced in the beginning was thoroughly testing and validating the Ensel technology. To do so, a pilot plant was constructed near FHR's Euless, Texas, fuel terminal. "After multiple rounds of testing, we felt confident the technology would be sustainable at a commercial-scale operation," Bezdek says. "Our next challenge will be scaling up production and, with luck, proving our assumptions were correct."

And finally, earlier in the year, Beatrice and surrounding areas were hit with 25-year flooding, which washed away some of the railroad tracks leading to the plant, leaving equipment stranded at another location. "Waiting for delivery put pressure on our timeline and resulted in some construction delays," Bezdek says.

On the recent release of the RFS RVO numbers, Bezdek says they have no bearing on the company's decision to operate its plants. "We don't consider it a significant factor in the viability of this project, or our biofuels and ingredients business," he says.

CHS/Jatrodiesel Inc.

Colocated with CHS's 125 MMgy ethanol plant in Annawan, Illinois, is a 5 MMgy supercritical biodiesel plant designed and built by process technology firm Jatrodiesel Inc. In an early November interview, Jatrodiesel President Raj Mosali told Biodiesel Magazine that the final stages of tying the automation into the process were underway. The innovative facility is able to capitalize on the existing ethanol plant's infrastructure, steam, and distillers corn oil byproduct for biodiesel feedstock. 

Jatrodiesel describes its Super technology as a single-stage process that eliminates esterification and transesterification, puts no limit on FFA levels in feedstock, and cuts the cost of traditional biodiesel refining by 25 to 28 percent, in part by eliminating the need for conventional catalysts.

During the process, feedstock is mixed with methanol and is introduced into the Super column, which operates in a supercritical environment. High temperatures and pressures are maintained, and complete conversion takes place in minutes with minimal or no loss in yield, according to Jatrodiesel. The feedstock's water content also has no effect on the process. The mixture coming from the Super column is then sent through a separation process to isolate biodiesel from glycerin, and the excess methanol is recovered. The biodiesel is then either water- or dry-washed to remove excess glycerin. "This changes the whole landscape," Mosali says. "The simplicity is remarkable-we're talking three or four steps in the Super process vs. 10 steps in traditional biodiesel processing. We have built 18 traditional biodiesel plants, and we know the complexity in the process due to variable feedstocks and FFA and, also, the complexity in operations due to various processes involved. The Super process addresses those issues and solves them."

There were three main challenges in commercializing the Super process, according to Mosali. The first was scale-up of a technology that has never before been commercialized. "There's no supercritical process used in a chemical plant at this volume, so all the pumps, valves, reactors, automation - it was all new ground for us," he says. The next hurdle was making the process truly continuous vs. batch. Most supercritical operations in other industries are batch, Mosali explains. "How to pressurize and relieve in continuous fashion was important," he says. The final and perhaps most significant challenge was overcoming the high equipment costs for a supercritical process. "If our capex was two to three times the cost of a traditional biodiesel plant, then simplicity and lower operational costs of the process wouldn't matter," Mosali says. 

Forging Ahead

In addition to the above projects, numerous others are under development, including Renewable Energy Group Inc.'s four plants in Emporia, Kansas; Clovis, New Mexico; Atlanta, Georgia; and New Orleans, Louisiana. Biodiesel Magazine was unable to obtain project updates from REG, and information on the projects wasn't provided during its Q3 2015 financial earnings call. However, CEO Daniel Oh said the company is making a "meaningful upgrade" at its Danville, Illinois, biorefinery. "We're investing over $30 million for a variety of enhancements that will enable us to produce high-quality biodiesel more efficiently," he said during the call. "We're adding distillation equipment that will result in a more pure final product, as well as expanding feedstock pretreatment capacity, storage and other logistical enhancements. Those upgrades are on track and we expect upgrade work at Danville to be completed around the middle of 2016."

Additional proposed projects include Viridis Fuels' 10 MMgy Oakland,California, facility, which received a CEC grant and is in early stages of development, as well as a new glycerin refinery at Louis Dreyfus Commodities 90 MMgy plant in Claypool, Indiana, scheduled to come online by the end of 2015. In addition, New Heaven Chemicals is nearing completion of an 18,000-ton sodium methylate plant in Manly, Iowa, to serve the growing, regional market, says Prasad Devineni, NHC managing director, with a second, larger catalyst plant under development in Houston. 

While the past year hasn't been the best of times, it certainly hasn't been the worst, and many projects have been moving forward, tax credit or not, low diesel prices or high, confident in biodiesel's role in the domestic fuel market. The biodiesel industry continues to develop and evolve, demonstrating the ability to stand on its own two feet. 



See conference article above.

See articles on our Home page. 
See article on our Home page. A workshop is tentatively planned in late February 2016 to update stakeholders on progress with ethanol pathways and provide guidance on other fuel pathways. Also, additional workshops may be scheduled in 2016 prior to the release of BD/RD and NG/RNG pathways. Details are  here: http://www.arb.ca.gov/fuels/lcfs/fuelpathways/fuelpathways.htm.

T he California Air Resources Board (ARB) recently released three new biodiesel pathways for public comment. The fuel pathway applications included 45 million gallons of used cooking oil (UCO) and animal fat biodiesel from India and 5 million gallons  per year of UCO biodiesel from Korea. CBA joined with NBB in submitting comments that opposed the approval of these pathways until a comprehensive verification and enforcement regulation is in place. ARB's rulemaking to develop such a regulation is scheduled to begin later this year. Comments 2526, and 27 are posted on ARB's website here: http://www.arb.ca.gov/fuels/lcfs/2a2b/2a-2b-com.htm.

At the CEC's ARFVTP Advisory Committee Workshop and public meeting on January 21st in Long Beach, the Lead Commissioner for Transportation and staff of the California Energy Commission discussed the revised staff draft of the 2016-2017 Investment Plan Update. CBA is preparing comments.

The 2015-2016 Investment Plan allocates $20 million for all biofuels production (no infrastructure investment funding). To stay abreast of solicitation opportunities, which are expected soon, sign up for the Alternative Fuels List Serve at: http://www.energy.ca.gov/altfuels/2015-ALT-01/.

See our Regulatory Matters webpage for information on compliance issues.   

Please contact the Washington office of the National Biodiesel Board (NBB) at 202-737-8801 for questions on federal policy issues. Click on the NBB Fueling Action logo below for information.       
TAX INCENTIVE - Text quoted from NBB email on 
January 19, 2016:

"We have received updated information from the IRS clarifying that claimants must wait until updated forms are released before submitting one-time claims for the 2015 biodiesel tax incentive.

As we reported Thursday, the IRS last week issued guidance stating that claims could be submitted using Form 8849 as early as January 15. However, updated forms have yet to be released. An IRS official has assured us that new forms will be issued before the formal filing period begins Feb. 8. We will notify you when the new forms are released.

The IRS guidance from last week can be found here on NBB's website. We encourage you to read the full memo, which is brief. Among other things, the memo states that:
  • A claimant or "blender" may submit a claim as early as January 15, 2016 and the 180-day claim period for 2015 biodiesel begins on February 8, 2016.
  • Claimants must submit claims for 2015 biodiesel on Form 8849 (updated form), Claim for Refund of Excise Taxes.
  • Claimants must include Schedule 3 (Form 8849) (updated form), Certain Fuel Mixtures and the Alternative Fuels Credit, with their submission and enter amounts for 2015 biodiesel on Line 2 and Line 3 of Schedule 3 as appropriate.
  • Claimants must claim all 2015 biodiesel incentives for which the claimant is eligible on a single Form 8849.
  • Claimants may not combine 2015 and 2016 claims for biodiesel incentives. Claims for 2015 incentives must be made in accordance with the rules for one-time claims prescribed in this notice, while 2016 claims must be made in accordance with the normal rules for such claims.
Please don't hesitate to call us with questions at 202-737-8801."

- Text quoted from NBB email on 
January 13, 2016:

"The National Biodiesel Board on Tuesday filed a legal brief with the U.S. Court of Appeals for the District of Columbia Circuit regarding our petition for review of EPA rules on Argentinian biodiesel imports under the Renewable Fuel Standard (RFS).

The brief can be found  here  on our website. 

The brief is the latest development in our fight against the EPA's decision last year to ease sustainability verification requirements on biodiesel imports from Argentina to the US. In January 2015, the EPA approved a proposal from Argentina's biofuels association, CARBIO, allowing a more streamlined survey approach for demonstrating feedstock sustainability instead of the more rigorous map and track requirements typically in place.  EPA also denied NBB's request to provide the public with notice and an opportunity to comment.

Because the EPA did not provide an open process when it considered the proposal, the limited information provided in EPA's approval documents raises significant questions about whether soybean-oil biodiesel being imported from Argentina meets the renewable biomass requirement under the regulation.  Even after a review of the documents on which EPA purportedly relied, there remain significant questions as to the efficacy of the new compliance requirements that could apply to the vast majority of over 1 billion gallons of production capacity in Argentina.

As we anticipated, imports from Argentina have increased sharply toward the end of 2015 and are expected to rise again this year.

In our most recent brief, NBB responded to EPA's claims that the U.S. biodiesel industry is not a proper party to challenge EPA's decision and that EPA can act outside of the public eye and without the court's oversight in this case.  The reply brief reminds the Court that EPA never disputed that Argentina continues to expand its agricultural base or that the CARBIO proposal was the first of its kind and differed from what EPA previously noticed to the public. "

    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

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* Sales greater than 8 million gallons per year: $10,000
* Sales less than 8 million gallons per year: $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:
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Just click on the "View CBA Email Newsletter Archive" button on our Home page (scroll down on the left).

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