There is an American product that creates good jobs, strengthens economies in communities large and small, and dramatically reduces carbon emissions. In an era of hyper-partisan bickering, this product has strong support from both Democrats and Republicans.
It almost sounds too good to be true – but it’s not. It is, however, at risk.
This product is clean fuel. Biodiesel, renewable diesel and sustainable aviation fuel are made from crops grown in America, crushed into meal and oil in America and then refined in America to create cleaner-burning fuels that can be used in vehicles that are already on the road and in the skies. Biodiesel and renewable diesel replace petroleum diesel, reducing carbon emissions by more than 70% on average.
According to trade estimates, the oilseed industry is investing more than $6 billion in 20 or more new facilities or expansions. These projects will increase soybean processing capacity by 30% between 2023 and 2026 and provide enough additional feedstock to support a 1-billion-gallon increase in biodiesel and renewable diesel production over the next several years.
The clean fuels industry has grown, in part, because of the national Renewable Fuel Standard or RFS. The RFS incentivizes businesses to use clean fuels, which creates a stable and robust market for both the farmers who grow feedstock and the facilities that convert those crops into meal — for food and feed — and oil — for food and fuel.
As recently as last year, the EPA was indicating that it would continue to increase volume targets under the RFS, creating more demand for clean fuels. The industry has risen to meet the moment by making plans to increase capacity substantially over the next three years.
Imagine everyone’s surprise, then, when the EPA released a draft RFS rule in December that sets clean fuels volumes for the next three years that are lower than what is already produced. If this proposed rule becomes final, it could jeopardize not only those who are currently employed but also undermine future job growth and the significant rural investments being made by oilseed processors to meet and exceed expected food, feed, and industrial market demand.
The EPA is set to finalize its rule in June, and farmers, workers and processors are counting on them to do the right thing and raise the volume targets for biomass-based diesel such as biodiesel, renewable diesel and sustainable aviation fuel.
The National Oilseed Processors Association (NOPA) supports the businesses that process crops such as soybeans into meal and oil that are used to create food, animal feed and clean fuels. I have seen these businesses, the jobs they create, and the economic benefits they bring to the communities where they operate, many of which are small or rural towns.
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Just how big are these benefits? The total economic impact on the U.S. economy just from crushing is on average $7.96 billion, supporting over 17,250 direct employees with a total wage impact of approximately $570 million. Demand for these oilseeds also impacts the demand and basis prices for local farmers, who in turn have more money to spend at local businesses.
NOPA and our member businesses are proud to be part of the solution to climate change.
The currently planned and impending substantial increases in the production of biodiesel, renewable diesel, and sustainable aviation fuel will collectively benefit soybean farmers, processors, rural communities and the livestock industry, while also creating jobs, diversifying our fuel supply, and reducing greenhouse gas emissions. The EPA must not leave these tremendous benefits on the table in its final rule.
Thomas Hammer has served as NOPA’s chief executive officer since October 2001. Hammer has nearly 40 years of involvement in agricultural and international trade policy, with extensive experience in both the government and private sector.