With Biodiesel Imports Expected to Increase, Brown Calls on EPA To Increase Domestic Biodiesel Fuel Volumes

Without an Increase in Biodiesel Volumes, Argentinean Imports Could Displace Domestic Production. Ohio Ranks Sixth in the Nation for Soybean Production and 25 Percent of Soybean Oil is Used for Biodiesel.

WASHINGTON, D.C. – Following the U.S. Environmental Protection Agency’s (EPA) significant delays in establishing biodiesel volumes under the Renewable Fuel Standard (RFS), U.S. Senator Sherrod Brown (D-OH) joined a bipartisan group of senators in applauding the release of a proposed rule on biodiesel volumes and urging the EPA to make increases in 2016 and 2017 biodiesel volumes in the final rule.

“America’s biodiesel manufacturers have the capability to drastically increase production, creating new jobs and securing our country’s clean energy future.” Brown said. “By increasing biodiesel volumes for 2016 and 2017, the EPA can support the growth of the domestic biodiesel industry and ensure that its producers don’t lose out to foreign imports.”

The Renewable Fuel Standard (RFS) is a federal program that requires transportation fuel sold in the U.S. to contain a minimum value for renewable fuels. The EPA is responsible for establishing annual biodiesel volumes for producers 14 months in advance. However, EPA had not released standards since 2013. Without these standards, producers were forced to reduce production, threatening jobs and economic productivity. Last year, almost 80 percent of U.S. biodiesel producers reduced production. While the EPA’s new four-year proposal for biodiesel volumes from 2014 through 2017 will help restore certainty to the biodiesel industry so it can plan for future production, it only allows for 1.9 billion gallons by 2017 – an amount only slightly higher than the industry’s actual production of more than 1.8 billion gallons in 2013. In a letter to EPA Administrator Gina McCarthy, the senators noted that, without a significant increase in biodiesel volume standards, the EPA’s recent decision to allow imports from Argentinean renewable fuel producers to participate in the RFS could displace domestic production. The senators called for an increase to at least 2 billion gallons in 2016 and at least 2.3 billion gallons in 2017.

Nearly half of the U.S.’s biodiesel supply – which burns more cleanly than oil and allows the U.S. to diversify its fuel production – is produced using soybean oil. In 2012, Ohio ranked sixth in the nation for soybean production – yielding $5.3 billion in economic impact. In April 2014, the Ohio Soybean Association named Brown Legislator of the Year for his work advocating for soybean farmers.

Full text of the letter is available below.

 

 

 

July 20, 2015

 

The Honorable Gina McCarthy
Administrator
U.S. Environmental Protection Agency
1200 Pennsylvania Avenue, N.W.
Washington, D.C. 20460

 

Dear Administrator McCarthy:

 

After significant delays in establishing biodiesel volumes under the Renewable Fuel Standard (RFS), we were pleased to see the Environmental Protection Agency (EPA) recently move forward with a new proposed rule. While the proposal is a positive step for biodiesel, we remain concerned that the proposed biodiesel volumes for 2016 and 2017 fail to adequately recognize the domestic biodiesel industry’s production capacity and its ability to increase production.

This new four-year proposal for biodiesel volumes from 2014 through 2017 is a much needed step toward restoring stability and certainty to the domestic biodiesel industry. EPA’s actions over the past year have led to tremendous uncertainty and hardship for U.S. biodiesel producers and thousands of their employees. As a result, many plants have been forced to reduce production and some have been forced to shut down, leading to layoffs and lost economic productivity.

While the proposal put forward by EPA is an improvement over the November 2013 proposal, it would only grow biodiesel volumes to 1.9 billion gallons by 2017 which is just slightly more than the industry’s actual production of more than 1.8 billion gallons in 2013. We believe the domestic biodiesel industry is fully capable of additional growth and urge the EPA to revise the volumes in the final rule. Based on the biodiesel industry’s projections for future capacity, growth, and demand, we believe increases to at least 2 billion gallons in 2016 and at least 2.3 billion gallons in 2017 would be reasonable and prudent.

Congress created the RFS to incentivize domestic production of clean renewable fuels, while still allowing imports to participate in the RFS. As a result, we have seen a steady stream of imported biodiesel participate in the program. Since EPA announced its new proposed rule, imports bound for the U.S. have increased significantly and are expected to keep growing. EPA’s decision earlier this year to allow imports from Argentinean renewable fuel producers to participate in the RFS must be taken into account, and biodiesel volumes must be set at sufficient levels to prevent displacement of domestic production.

Biodiesel is the first EPA-designated advanced biofuel under the RFS to reach commercial scale production nationwide. It is exceeding the goals that Congress envisioned when it created the RFS with bipartisan support in 2005, while creating jobs, generating tax revenues, reducing pollution, and improving energy security. We urge you to support continued growth in the domestic biodiesel industry by making reasonable and sustainable increases in the biodiesel volumes for 2016 and 2017 in the final rule.

Sincerely,

                                   

cc: The Honorable Tom Vilsack, Secretary, U.S. Department of Agriculture

The Honorable Shaun Donovan, Director, Office of Management and Budget

 

 

 

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