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California Biodiesel Alliance News

California's Biodiesel Industry Trade Association  

October 2013    

In This Issue
Celebrating Success - Building for the Future! 2014 Conference Registration is Live!
Biodiesel Curve Shoots up Steeply in New 2013 Quarterly LCFS Report
Governor Brown Signs AB 8: Clean Vehicle Incentives Funded Through 2023
Speak Out Again Proposed 2014 RFS Volumes! New Online Tool Lets You Do It in 1 Minute
REGULATORY AND POLICY ISSUE UPDATES
CBA WELCOMES NEW MEMBERS: Altitude Fuel, California Biodiesel Initiative, Stoel RIves
WHO'S WHO IN CALIFORNIA BIODIESEL: Jim Levine, North Star Biofuels

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CBA continues our pattern of steady growth as we welcome two new Bronze Business members, Stoel Rives LLP and the California Biodiesel Initiative. We also extend a special welcome to CBA's newest Gold Business member, Altitude Fuel, and to Mark Shufelt who now represents the company on our board of directors. 

We are excited to announce the opening of online registration for our 2014 conference and to ask you to consider becoming a sponsor of this celebratory and informative event.  All eyes are on California! 

 

This month's issue features important articles on continued funding for biodiesel and our success under LCFS. We congratulate North Star Biofuels on getting its biodiesel production plant in Watsonville up and running, and reveal as much as we can, in a Who's Who interview with Jim Levine who co-founded the company and serves as its chairman.

  

NBB has a new online form that lets you send a letter on RFS to US EPA Administrators McCarthy and Shelanski in less than a minute. Do this, please, then make a call to our Senators (below)!  

 

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 and Renewable Diesel Conference 2014   

 

Celebrating Success - Building for the Future! 

 

2014 Conf Logo
  Monday, January 20, 2014

San Diego Convention Center next to the  

San Diego Marriott Marquis & Marina

   

CBA members will receive a discount.
All registrants will receive $100
off the regular price of the co-located

Our 3rd annual California Biodiesel and Renewable Diesel Conference, presented by the California Biodiesel Alliance and the National Biodiesel Board, echos the "Strong" theme of the co-located National Biodiesel Conference & Expo.

California's biodiesel industry has grown in size, strength, and stature and has achieved important milestones in bringing biodiesel to market in our state. Diesel substitute fuels now lead the much faster-than-anticipated evolution of the alternative fuels market here. Our state's embattled Low Carbon Fuel Standard (LCFS) prevails against its enemies and is literally fueling a revolution, creating a potential 800,000 gallon demand for biodiesel alone by 2022!

Get the latest exciting updates directly from the architects, defenders, and developers of both California's suite of low carbon transportation fuels policies and its unique world of feedstocks.

 

BECOME A SPONSOR  ------   BECOME AN EXHIBITOR                    

Biodiesel Curve Shoots up Steeply  

in New 2013 Quarterly Data Summary LCFS Report

 

On September 30th, the California Air Resources Board released its 2013 LCFS Reporting Tool (LRT) Quarterly Data Summary - Report No. 2. The report shows that the LCFS program, from its inception through the end of Q2 2013, has generated about 4.34 million metric tons (MT) credits and 2.70 million MT deficits, resulting in a net total of about 1.64 million MT credits. It shows that in the second quarter of 2013, about 802,000 MT of credits were generated compared to 617,000 MT of deficits.

 

In a chart that breaks down the total amount of credits generated in the last ten quarters since January 2011 by fuel types, biodiesel's rise over time steeply increases during the first quarter of 2013, when it moves from 20,000 to 120,000 (Credit MT).

 

The report, which also looks at the number of parties reporting data into the LCFS Reporting Tool (LRT) since January 2011, shows an increasing trend in compliance, with 100 parties now reporting transactions in the LRT. As of the end of Q2 2013, 28 regulated parties have sold credits, 21 regulated parties have purchased credits, and 9 regulated parties have transacted both sales and purchases.   

 

A chart of Aggregated Credit Transactions Data shows that the total volume of trades and the average price of credits have risen consistently from 165,000 to 244,000 and $16 to $54 from CY 2012 to September 2013, respectively.   

  

Quarterly Data Summaries can be found under the LCFS Reporting Tool header on the left near the bottom of the page at:  http://www.arb.ca.gov/fuels/lcfs/lcfs.htm.    

 

Governor Brown Signs AB 8    

Clean Vehicle and Fuel Incentives Funded Through 2023

 

CBA has been working on behalf of legislation to continue the state's clean vehicle and fuel incentives programs through 2023, and we are happy to report that AB 8 passed the California State Senate and Assembly on a bipartisan vote and has been signed into law by Governor Jerry Brown. The law was authored by Assemblymember Henry T. Perea, with Senator Fran Pavley as the main co-author; sponsored by CALSTART, California Air Pollution Control Officers Association, (CAPCOA) and the American Lung Association in California; and supported by a broad coalition. 

 

AB 8 continues the California Energy Commission's AB 118 Alternative and Renewable Fuel and Vehicle Technology (ARFVT) Program and two local air district programs for diesel emission reduction, Carl Moyer and AB 923, providing more than $2 billion in funding  

  

Included are two programs under the Air Quality Improvement Program -- the Clean Vehicle Rebate Project (CVRP), the state's current plug-in rebate program, and the Hybrid and Zero Emissions Truck and Bus Voucher Incentive Program. Funding for the Enhanced Fleet Modernization Program of vehicle retirement and replacement is also included under AB 8.  
 
Up to $20 million a year from the ARFVT Program is provided for building fueling infrastructure to support the expected introduction of hydrogen fuel cell vehicles.

 

Very important for the biodiesel industry is the continuation of the ARFVT program, a key source of funding for biodiesel production, and the new law's requirement of the use of metrics in decision making in the allocation of funds under that program, something that CBA has repeatedly called for.

Speak Out Again Proposed 2014 RFS Volumes!

New Online Tool Lets You Do It in One Minute 
  

NBB Fueling Action Logo      

 

Please use the new online tool at NBB's Fueling Action webpage to send a pre-written letter to the Administration calling for reasonable volume levels for 2014. It literally takes a minute!      

The Administration is preparing to set the 2014 biomass-based diesel RFS volume at 1.28 billion gallons, a sharp reduction from this year's projected production. Setting the biodiesel volume for next year back to 1.28 billion gallons would reduce biodiesel production by some 25 percent and deliver a devastating blow to a young and growing industry, especially in California. We are asking for a modest volume increase for biomass-based diesel that is at a minimum consistent with this year's projected production of 1.7 billion gallons.    

 

When you've done that, please make a call or contact these staff members requesting that their bosses reach out to the administration directly with our message: 

    

Senator Boxer

Kyle Chapman

Kyle_Chapman@boxer.senate.gov

(202) 224-3553.

 

Senator Feinstein

Matthew Nelson

Matthew_nelson@feinstein.senate.gov

202-224-3841

 

Thank you! 

 REGULATORY AND POLICY ISSUE UPDATES

French fries Beautiful oil  French fries

  

 

CALIFORNIA AIR RESOURCES BOARD: AB 32    
CBA joined over thirty NGOs and businesses in signing a letter to Governor Brown on Cap and Trade auction proceeds. It stated that "we respectfully request that your January 2014 budget proposal include the following three items: 1) a commitment that no more Cap and Trade auction proceeds will be loaned to the General Fund; 2) a plan to spend cap and trade auction proceeds in the 2014-15 fiscal year; and 3) a detailed repayment plan for the $500 million in auction proceeds borrowed in fiscal year 2013-2014, with repayment beginning as soon as possible and no later than fiscal year 2014-15."
 

Also, this month, CARB released its draft 2013 Scoping Plan, a report required every five years under AB 32. It includes a review of policies, including California's Cap and Trade, LCFS, AB 118, and a range of other programs, and how they interact with one another to address climate change over the next five years and to reach the state's greenhouse gas emissions (GHG) reduction goals for 2020 and 2050.

 

In response to the plan's emphasis on the role of ZEVs (electric and hydrogen) in achieving GHG reduction targets between 2020 and 2050, and only a minor role for low carbon intensity liquid fuels, CBA has submitted comments requesting a greater emphasis on biodiesel as the lowest carbon intensity liquid fuel for reducing GHG. Our recommendation also is that an interagency and stakeholder group be empaneled to look at the budgets and impacts of all current and proposed spending (including procurement) by state agencies on GHG reduction programs and their actual and potential impacts. An annual report should be issued by the group so that state agencies can coordinate their budgets with an eye towards balanced funding for the most cost effective projects and programs. We believe that if this is done there will be a much greater likelihood that California will be able to meet its GHG reduction goals, and that biodiesel will play a much greater role.  


CALIFORNIA
AIR RESOURCES BOARD: ADF RULEMAKING PROCESS
Below is updated information on the schedule and process for finalizing the alternative diesel fuels (ADF) regulation. It is quoted from the agency's Oct 23rd listserve email:

 

"The Air Resources Board (ARB) will conduct a public hearing to consider a proposed regulation governing the commercialization of motor vehicle Alternative Diesel Fuels. 
Date:       December 12, 2013
Time:       9:00 a.m.
Place:     California Environmental Protection Agency
                Air Resources Board
                Byron Sher Auditorium
                1001 I Street
                Sacramento, California 95814

Interested members of the public may present comments orally or in writing at the meeting and may provide comments by postal mail or by electronic submittal before the meeting.  The public comment period for this regulatory action will begin on October 28, 2013.  To be considered by the Board, written comments not physically submitted at the meeting, must be submitted on or after October 28, 2013 and received no later than 12:00 noon on December 11, 2013, and must be addressed to the following: Postal mail:    Clerk of the Board, Air Resources Board: 1001 I Street, Sacramento, California 95814. Electronic submittal: http://www.arb.ca.gov/lispub/comm/bclist.php

This notice and the associated regulatory materials can be accessed from the Air Resources Board's website at: http://www.arb.ca.gov/regact/2013/adf2013/adf2013.htm"

CALIFORNIA AIR RESOURCES BOARD: LOW CARBON FUEL STANDARD (LCFS)
See article above.

CALIFORNIA ENERGY COMMISSION (CEC): IEPR
In response to the CEC's draft 2013 IEPR, CBA has submitted comments addressing some factual errors that we would like staff to correct concerning biodiesel. Also, in response to the lack of any mention of metrics in the AB 118  Benefits Section of the report, we have reiterated our call for the use of metrics under that program, as specifically required in AB 109. 
 

CALIFORNIA ENERGY COMMISSION (CEC): AB 118 FUNDING

A solicitation is expected soon. The CEC adopted its 2013-2014 Investment Plan Update for the Alternative and Renewable Fuel and Vehicle Technology Program at a Business Meeting on May 8th. All details of the plan, which allocates $23 million for Alternative Fuel Production facilities, are posted at: http://www.energy.ca.gov/2012-ALT-2/. Interested parties are encouraged to subscribe to the CEC's Alt Fuels Listserv on that page to stay informed of upcoming solicitations.
 

STATE WATER RESOURCES CONTROL BOARD: UST REGULATIONS

There is no policy update this month. CBA urges compliance with the new 2012 permanent regulations governing UST storage of biodiesel. See our Regulatory Matters webpage for more information and links to the State Water Board website that posts the new compatibility forms from equipment manufacturers. The Water Board list is constantly being updated as new and revised forms come in, but revised forms are not labeled as such. Also, please be advised that your CUPA may require engineering approvals for non-integral secondary containment (sumps and UDCs).    

   

CALIFORNIA LEGISLATIVE ISSUES     

See article above on the passage of AB 8.

     

FEDERAL ISSUES
See article above on the Renewable Fuel Standard (RFS)!
CBA WELCOMES NEW MEMBERS 



Altitude Fuel specializes in the buying, selling and transporting of energy products in North America and abroad.







Stoel Rives is a leader in corporate, energy, environmental, intellectual property, labor and employment, land use and construction, litigation, natural resources, real estate, renewable energy and technology law.







The California Biodiesel Initiative is an environmental partnership between the California Biodiesel Alliance and the National Biodiesel Board.
    


______  JOIN CBA AS AN INDIVIDUAL, A NONPROFIT, OR A BUSINESS  _____  

 

If you are reading this and are not yet a member, please join us. CBA offers membership levels with the following annual dues: $25 for students and veterans; $100 for individuals and nonprofit organizations; $500 (Bronze business level); and $2000 (Silver business level). Full voting board level memberships are available by application at $3000 (Gold) or $5000 (Platinum). Our Join Us webpage has details and an easy online membership fee payment process.
   

Membership benefits include:   

  • CBA's Email Newsletter with important industry updates and features about Who's Who in biodiesel in California and Action Alerts when your help can really make a difference.
  • Participation in internal email communications, policy discussions, and legislative and regulatory visits. 
  • Discount on CBA's annual California Biodiesel and Renewable Diesel Conference.
  • Your company's logo and link on our Members webpage ($500 level and up).  
  • Special recognition at events and in publications (Platinum members).    

_______   SIGN UP FOR EMAIL ALERTS  _____

 

Anyone can sign up to get CBA's special Alert emails, which we send out when we need biodiesel stakeholders and enthusiasts to take action on important issues facing our industry. Visit our Home page and add your email address.  

 

_______   VIEW PAST NEWSLETTERS AND EMAIL ALERTS  _____

 

Just click on the "View CBA Email Newsletter Archive" button on ouHome page.

WHO'S WHO IN CALIFORNIA BIODIESEL 


Jim Levine

Co-Founder and Chairman, North Star Biofuels LLC  

 

  

Before coming to the biodiesel industry, Jim Levine had a successful career in environmental engineering, including superfund clean up and real estate redevelopment of large military and industrial properties, working as an engineer, innovative business founder, and managing partner. He was working on a contract for the Navy and the Army on stabilizing radioactive materials from weapons, including dirty bombs, when his business partner Michael Doyle, an engineer and inventor with years of experience working for Neste Oil and other petroleum companies, approached him with an idea he believed would revolutionize the production of biodiesel. Jim wasn't sure how this would work but believed that if it did it would be an innovation that would produce an ultra-pure product and contribute to the advancement of the biodiesel industry.

 

In 2009, Jim and Mike co-founded R Power Biofuels. Jim managed the operation and provided the start-up funding after finding the process of securing financing "tough" due to skepticism about the new technology and the venture capital community having felt the sting of losing money in this field. The company's proprietary technology was developed in the lab and impressively scaled up to a commercial level at their pilot facility at the Port of Redwood City by 2011. The tours they offered were met with interest from major refiners, airlines, and a large meat company that immediately put R Power in touch with Agri Beef Co., a leader in the U.S. meat industry. Four months later, they started working together, and North Star Biofuels was formed as a joint venture between R Power and Agri Beef, with a plan to build a multi-feedstock, full-scale production facility in Watsonville using tallow and other feedstocks that would have a carbon intensity of 65 to 85 percent less than petroleum diesel.

 

Not surprisingly, Jim says that project completion was a lot of work, citing both the challenges of partnering with a company from such a different field and troubleshooting a range of predictable and not-so-predictable construction and other issues. North Star completed its 15 to 20 million gallon plant in Watsonville just this summer and is now operating at about half capacity.

According to Jim, some things are running very smoothly and some are proving very difficult. He says that their proprietary equipment has worked fine, but that they have spent the last three months doing difficult retrofitting involving redesigning and rebuilding some of the equipment designed by third parties that was defective. In general, he credits his work for the last 12 years as owner of the Bay Area's disposal site for dredging at the Port of Oakland and other ports, Montezuma Wetlands, as very helpful in providing important experience with certain start-up issues such as permitting, business relations, and government contracting. North Star, which is fully funded, did receive a grant for the Watsonville plant from the California Energy Commission but declined it after deciding that some of the rules, including the prevailing wage requirement, were onerous.

 

Explaining how they were able to make their small footprint facility operational with its batchless, fully continuous, and highly automated features, Jim says that they used quite a few trade secrets, and that, in fact, it was hard for them in the beginning and took years and years to replicate. The production process right now has about a 10-minute throughput time, unlike the more conventional 8 hours or longer. When the day tank is full, they test and certify that fuel and move it into the sale tank. So far, they have had to shut down for maintenance, but are steadily moving toward reliable and consistent operations with the goal of 24/7 production and ramping up to full capacity as soon as possible.

 

Jim says that once they demonstrated the capability to meet the stringent biodiesel specs of oil companies, who are blending B5 to comply with state and federal regulations, they received plenty of inquiries for demand. Right now, by selling to them they can keep things simple and move later to diversify and achieve some of their original goals, including on-site blending; customized fueling service with on- and off-site fleet card-lock facilities and fuel delivery services; selling biodiesel back to the feedstock companies for use in their equipment and distribution fleets; and possibly a second plant. They hope to also make inroads selling B20, which has a large industrial sector market.

 

"LCFS, which is an efficient mechanism for institutionalizing a preference for local, low carbon fuels, is both an opportunity and an obligation. North Star strongly supports LCFS, because we believe it's the best, demonstrated way to reduce the carbon footprint of transportation fuels today. It's also important that we work collaboratively with oil companies because we need each other to survive and to achieve a seamless, reliable, and efficient supply chain for these low carbon fuels," Jim says. He points out that the timing of his company's entry into biodiesel production was good because they are starting up as LCFS is kicking in, and his team is able to bring their history of good relationships with business groups and legislators to the task of strengthening the program.

 

When Jim is not meeting the demands of his full-time job in biodiesel, he serves on a number of boards, including the Bay Area Council, Northern California's leading business group, where he has been an Executive Committee Member and Water Committee Chair since being recruited in 2007. He believes it's important to stay informed about what's really going on around the state and to be involved in the synergistic efforts of the huge range of people working to improve our state's environment. When asked how he does it all -- including playing lead guitar in a rock band performing classic hits with his wife -- Jim says he is super focused, stays clear, and works efficiently because he believes it's important to diversify one's activities to stay inspired and fresh.  

 

While North Star's proprietary information is tightly held, the purity and quality of their fuel is not a secret, and our industry is happy to congratulate the team of this member company on their success. CBA looks forward to their official opening event next year in Watsonville and to continuing to work with Jim and his team on LCFS defense and other issues benefiting biodiesel in California.

Thank you for your time and efforts on behalf of biodiesel. I look forward to working with you.  

 

Sincerely,

Celia DuBose

Executive Director

California Biodiesel Alliance