Jan 23, 2014
The National Biodiesel Board (NBB) held its annual conference this week in San Diego, Calif. As always, the soybean industry has a large presence at the conference. ASA Board Member and representative to the NBB, Mike Cunningham of Illinois, ASA Washington staff and many other soybean farmers and state soybean association staff are participating in the conference. Attendees heard from experts and industry representatives on feedstock technology developments, diesel engine developments and vehicle offerings, federal and state policy issues, as well as a session with an EPA representative on the Renewable Fuel Standard (RFS).
The overall theme of this year's conference is "Strong," representing strong policy, strong markets and a strong stand to secure increased volume targets under the 2014 RFS requirements. In 2013, the biodiesel industry achieved record production, estimated to be around 1.7 billion gallons. However, with the expiration of the $1.00 per gallon federal biodiesel tax credit at the end of 2013 and the EPA's proposal to limit the 2014 RFS biomass-based diesel volume requirements to 1.28 billion gallons, the industry is faced with the prospect for contraction in 2014.
In his opening remarks NBB CEO Joe Jobe told conference attendees that the petroleum industry is misleading Americans about renewable fuel policy (RFS)-- the most important policy component to the biodiesel. He also called on President Barack Obama to stand firm behind his previous commitments to supporting alternative energy industries.
“The Renewable Fuel Standard is effective policy that is working. It is fulfilling its intention to establish diversity, competition and choice in the transportation fuel sector, which is why the incumbent industry is trying to kill it,” Jobe said.
Jobe defined the “incumbent,” as Big Oil and those working around the clock to erase the RFS and all it has accomplished. He pointed out that the idea of a free energy market is false and that nothing about the global or domestic petroleum market is free. The petroleum sector has, since its start, enjoyed tax and policy support. They began at the birth of the industry and continue today. Jobe cited some of the specific tax code preferences enjoyed by the oil and gas industry including, Percentage depletion deduction – a deduction where companies can write off more than their actual cost, in some cases significantly more.
“To say that the RFS skews the free market is nonsense. The RFS is a necessary policy to create and protect a modest level of diversity. It is working and needs to be allowed to continue to work and grow as intended. It is the pathway to a free-er market. It is a pro-competitive policy that stimulates investment and innovation,” Jobe said.