SAN DIEGO, Jan. 17, 2016 - The biodiesel industry may have been an “underdog” of sorts during its relatively short history, but now, “we are strong and we are a force to be reckoned with,” National Biodiesel Board CEO Donnell Rehagen emphasized during the organization’s opening session in San Diego today.
NBB was created in 1992 before biodiesel even existed in the United States. “Think about that … a trade association was created for a product that didn’t exist,” Rehagen said. NBB is the U.S. trade association representing biodiesel and renewable diesel industries, including producers, feedstock suppliers, and fuel distributors.
But industry champions like AGP, REG and groups of farmers invested in some of the first biodiesel plants in the late 1990s. The industry started to really grow after the passage of the Biodiesel Tax Credit in 2004, Rehagen said, and even though the industry has had its share of ups and downs, its 89-member facilities now produce over 2 billion gallons – supporting over 47,000 jobs and $1.9 billion in wages.
He also shared a new analysis, which showed that getting the Renewable Fuel Standard to 2.5 billion gallons for biodiesel would support 81,600 jobs and have a $14.76 billion economic impact.
“We are still very much a growing industry and we have a lot of growth potential. Congress needs to understand … if we are going to keep pushing volumes of biodiesel, policy support needs to be there as well.”
U.S. biodiesel producers have more than 1.5 billion gallons of unused production capacity that stands ready to be utilized under the right policy framework. Mobilizing that capacity would create thousands of jobs and billions of dollars in economic activity, NBB says.
NBB wanted to extend the biodiesel tax incentive and move it from a blender’s tax credit to a producer’s tax credit. Under the “blender’s” structure of the incentive, foreign biodiesel imported to the U.S. and blended with petroleum diesel in the U.S. was eligible for the tax incentive. But the blender’s credit expired on Dec. 31, 2016. Proposed legislation in the House and Senate (HR 5240, S 3188) could be a remedy, but it’s uncertain whether or not that legislation will be included in a potential tax reform package that’s being developed on Capitol Hill
In other convention news:
Staffing up. Rehagen announced plans to hire a new lobbyist and new Director of Advocacy, whose job will be to work proactively with member companies to increase outreach to their elected officials, both in-state and on Capitol Hill. “Advocacy is a big deal for us and we want to expand that footprint,” Rehagen said.
Bioheat growth. New legislation approved in New York City last fall will increase the amount of biodiesel in heating oil from the current 2 percent level to 5 percent on Oct. 1, 2017. The blend level then moves to 10 percent in 2025, 15 percent in 2030, and 20 percent in 2034 – the equivalent of taking 175,000 cars off the road. The amount of biodiesel used for home heating oil there is expected to skyrocket from 50 million gallons last year to 200 million gallons by 2034. Council Member Costa Constantinides, who serves the New York City Council’s 22nd District and championed the bill, was presented with NBB’s Climate Leader award. He described the measure as “green, green, green” because it saves consumers money, creates thousands of jobs, and improves the environment. He said the number one reason a child goes to a hospital in his district is asthma and they lose between 10-30 days of school. “I knew this is where we had to be.” He hopes the bill creates a pathway for statewide adoption.
Energy security = national security. Former FBI hostage negotiator and Black Swan CEO Chris Voss, the author of “Never Split the Difference: Negotiating as if your Life Depended on it,” delivered the keynote speech Tuesday and shared his thoughts on the connection between energy security and national security. “The significant long-term impact of biodiesel fuels in cleaning up existing fuels and having a greener planet is stunning in how much difference it’s going to make over the next 100 years,” Voss said. “It’s the United States not being held hostage by international interests.”
B20 club expanding. The B20 Club – funded by the Illinois Soybean Association checkoff program, in partnership with the American Lung Association in Illinois – supports the growth of biodiesel blends of 20 percent or greater through signage, social media and networking with other fleet managers. The current 14 B20 members, including the Chicago Park District, the City of Evanston and Commonwealth Edison, have 4,809 fleet vehicles running on biodiesel. The program saves thousands of dollars in fuel costs, while improving the environment, says Mike Dimitroff, manager of arts initiatives, Chicago Park District Department of Natural Resources. He leads a program which converts cooking oil from Chicago-area restaurants into biodiesel fuel for 55 park vehicles, and he’s working to switch other city fleets to biodiesel in the future.
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