Biodiesel Industry Sets New Production Record

Jan 30, 2014

The United States biodiesel industry set a new record of production in 2013, which the National Biodiesel Board (NBB) said underscores the importance of revising the Environmental Protection Agency’s (EPA) proposed Renewable Fuel Standard (RFS) proposal this year.

According to a news release from this week, with nearly 1.8 billion gallons produced last year, the industry’s total production significantly exceeded the 2013 biodiesel requirement under the RFS and was enough to fill the majority of the Advanced Biofuel requirement. Yet the Obama Administration has proposed holding the 2014 RFS volume for biodiesel at 1.28 billion gallons while also sharply cutting the overall Advanced Biofuel requirement – a proposal that, if finalized, would significantly reduce production.

Biodiesel industry leaders are calling on the Administration to increase the biodiesel and Advanced RFS proposals to at least reflect the current production rates.

“The success of the biodiesel industry in 2013 proves that the RFS is working today and stimulating the commercial-scale production of advanced biofuel. It also makes it incredibly frustrating that the Obama Administration is backing away from this progress with its recent RFS proposal,” said Joe Jobe, CEO of the National Biodiesel Board (NBB), the U.S. trade association. “If our industry produced 1.8 billion gallons of Advanced Biofuel in 2013, why is the Administration retreating to 1.28 billion gallons for 2014?” Jobe asked. “We’re proving it can be done. What we need is consistent policy, and that is sorely lacking in Washington right now.”

Jobe added that it is “incomprehensible” that the Administration has suddenly decided to retreat after supporting renewable fuels since the beginning.

“It threatens biodiesel businesses across the country and thousands of jobs, and it undercuts the Administration’s stated priority of reducing greenhouse gas emissions,” he said. “Perhaps more importantly, it jeopardizes the future of all renewable energy by sending a terrible signal to entrepreneurs and investors that these policies are not stable, even under a President who professes to support them.”

According to the NBB release, because some excess 2013 biodiesel production could be “carried over” into 2014 for RFS compliance purposes, the real RFS market this year could be closer to 1 billion gallons for biodiesel – a cut that would shock the industry. News outlets around the country have published stories recently highlighting the harm the proposal would do to local producers.

In addition to the weak RFS proposal, Congress also allowed a key biodiesel tax incentive to lapse on Dec. 31, further disrupting the industry.

“Many biodiesel producers have been running at full capacity in recent months,” Jobe said. “That’s driving down costs and creating tremendous economic activity. Yet instead of embracing this success, Washington is walking away from it.”

According to a recent study, the industry is supporting more than 62,200 jobs nationwide and nearly 8,000 of those jobs would be threatened by a drop in production back to 1.28 billion gallons. Biodiesel reduces greenhouse gas emissions by 57 percent to 86 percent, according to the EPA.