Advanced and Cellulosic Biofuel Trade Association Comments on EPA Proposal for 2014, 2015 and 2016 Renewable Fuel Standards

The Biotechnology Industry Organization (BIO), representing more than 90 companies leading the development of advanced and cellulosic biofuel companies, today submitted comments on the Environmental Protection Agency’s (EPA) proposed rules for the 2014, 2015 and 2016 Renewable Fuel Standards (RFS). BIO’s comments make clear that if the agency does not correct its course on the program, it will continue to undermine the goals and requirements of the statute, undercut investment in advanced and cellulosic biofuels, and raise greenhouse gas emissions in the transportation fuel sector.

BIO represents leading developers and producers of cellulosic and advanced biofuels, including Abengoa Bioenergies in Hugoton, Kan.; DuPont in Nevada, Iowa; Enerkem in Alberta, Canada; GranBio in Alagoas, Brazil; INEOS Bio in Vero Beach, Fla.; POET-DSM in Emmetsburg, Iowa; and ZeaChem in Boardman, Oregon. The advanced biofuel industry has invested more than $6 billion since 2009 to build first-of-a-kind biorefineries around the world. Through the application of industrial biotechnology, BIO members are improving conventional biofuel processes, commercializing advanced and cellulosic biofuel production technologies, and speeding development of new purpose grown energy crops.

Brent Erickson, Executive Vice President of BIO’s Industrial & Environmental Section, writes in the comments:

“The RFS has been a critical piece of our nation’s energy and climate policy. It has driven the investment of billions of dollars in the development and commercial deployment of ultra-low-carbon biofuels. It has spurred innovation beyond biofuels to the development of greener technologies and manufacturing processes while curbing our dependence on foreign oil. These developments were intended by Congress when Congress created the RFS program.

“Unfortunately, as explained in our comments, EPA’s new interpretation of its statutory authority to waive the requirements of the RFS statute is impermissibly broad and goes beyond the bounds set by Congress. As a result, the method EPA has used to set the volumes based on its mistaken view of its waiver authority has already chilled investment for advanced biofuels and has increased U.S. greenhouse gas emissions. If EPA issues a final rule that adopts the approach set forth in the proposed rule, the result will be continued market uncertainty and market constraints that will further disincentivize sustained investment in advanced biofuels.  Further, the proposed rule would improperly and unnecessarily select volumes that would potentially trigger a rewrite of the RFS, which would generate even greater market uncertainty. In addition, EPA’s proposal is flawed in a number of other significant respects that lead it to undercalculate the correct volumes to select.

“We submit that this outcome can be avoided.  EPA can get the program back on track and can help drive the growth of the advanced and cellulosic biofuels industry in the manner that Congress intended and, indeed, required.  To this end, EPA should continue to expedite the approval of new advanced and cellulosic biofuels pathways and should work to properly calculate all supplies of cellulosic biofuels to more accurately set the appropriate annual RVOs.  And EPA should avoid a reading of the statute that would empower incumbent fuel producers – who want to see the program fail – to define future RFS blending obligations by their own inaction and their efforts frustrating the statutory purpose.”

BIO’s recommendations to the agency include:

  1. Establish the cellulosic RVO for 2015 at no less than 157 million gallons and for 2016 at no less than 350 million gallons. Work with foreign producers and expedite approvals of pathway petitions to bring more advanced and cellulosic biofuels into the market.
  2. No reductions need be made – nor should be made – on the basis of the statute’s general waiver authority.
  3. Set the 2015 and 2016 advanced and overall RVOs at the full statutory volumes; EPA has not met its burden to prove the need to reduce the volumes.
  4. If EPA were able to adequately justify utilizing its cellulosic waiver authority to shrink the market for advanced and overall renewable fuels, then volume obligations should be set at the highest levels achievable through the renewable fuels industry’s growing capacity to produce higher volumes in the future.
  5. In setting the volumes, EPA should take into account the availability of carryover RIN credits as done in prior years.

Source: Biotechnology Industry Organization
Date: Jul 27, 2015