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Biofuels Bulletin By Ron Kotrba, Biobased Diesel Daily Winning Political Tetris in Washington, DC The pieces are falling into place in Washington, DC, ĨŽƌ ďŝŽĨƵĞů ƐƚĂŬĞŚŽůĚĞƌƐ ĂƐ ĐŽŶĮƌŵĂƟŽŶƐ ŽŶ ŬĞǇ ĐĂďŝŶĞƚ positions move forward after a tumultuous transition between presidential administrations this winter. In the final hours of President Donald Trump’s administration, Andrew Wheeler, administrator of the United States (US) ŶǀŝƌŽŶŵĞŶƚĂůWƌŽƚĞĐƟŽŶŐĞŶĐǇ;WͿ͕ŐƌĂŶƚĞĚƚŚƌĞĞƐŵĂůů ƌĞĮŶĞƌǇĞǆĞŵƉƟŽŶƐ;^ZƐͿƚŽƚŚĞZĞŶĞǁĂďůĞ&ƵĞů^ƚĂŶĚĂƌĚ (RFS) for compliance years 2018 and 2019. These waivers ĂīĞĐƚĞĚŶĞĂƌůǇϯϲŵŝůůŝŽŶŐĂůůŽŶƐŽĨďŝŽĚŝĞƐĞůĂŶĚƌĞŶĞǁĂďůĞ ĚŝĞƐĞů͕ ĂĐĐŽƌĚŝŶŐ ƚŽ WĂƵů tŝŶƚĞƌƐ͕ ĚŝƌĞĐƚŽƌ ŽĨ ƉƵďůŝĐ ĂīĂŝƌƐ ĂŶĚĨĞĚĞƌĂůĐŽŵŵƵŶŝĐĂƟŽŶƐĨŽƌƚŚĞEĂƟŽŶĂůŝŽĚŝĞƐĞůŽĂƌĚ ;EͿ͕ďƌŝŶŐŝŶŐƚŽƚĂůĚĞŵĂŶĚĚĞƐƚƌƵĐƟŽŶĨŽƌďŝŽŵĂƐƐͲďĂƐĞĚ diesel to 578 million gallons since 2015. EŽǁ ƚŚĂƚ tŚĞĞůĞƌ ŚĂƐ ůĞŌ ƚŚĞ ĂŐĞŶĐǇ͕ Ă ŶĞǁ ĂƫƚƵĚĞ toward the RFS has begun to emerge. In late February, EPA ĂŶŶŽƵŶĐĞĚƚŚĂƚ͞ĂŌĞƌĐĂƌĞĨƵůĐŽŶƐŝĚĞƌĂƟŽŶ͟ŽĨƚŚĞ:ĂŶƵĂƌǇ 2020 Tenth Circuit Court of Appeals decision on SREs, ǁŚŝĐŚ ƉƵƚ ƐŝŐŶŝĮĐĂŶƚ ĐŽŶƐƚƌĂŝŶƚƐ ŽŶ W͛Ɛ ĂďŝůŝƚǇ ƚŽ ŐƌĂŶƚ ƚŚĞƐĞ ĞǆĞŵƉƟŽŶƐ͕ ƚŚĞ ĂŐĞŶĐǇ ŶŽǁ ĂŐƌĞĞƐ ǁŝƚŚ ƚŚĞ ĐŽƵƌƚ͛Ɛ ŝŶƚĞƌƉƌĞƚĂƟŽŶ͘͞dŚĞĐŚĂŶŐĞƌĞŇĞĐƚƐƚŚĞĂŐĞŶĐǇ͛ƐĐŽŶƐŝĚĞƌĞĚ ĂƐƐĞƐƐŵĞŶƚƚŚĂƚƚŚĞdĞŶƚŚŝƌĐƵŝƚ͛ƐƌĞĂƐŽŶŝŶŐďĞƩĞƌƌĞŇĞĐƚƐ ƚŚĞƐƚĂƚƵƚŽƌǇƚĞǆƚĂŶĚƐƚƌƵĐƚƵƌĞ͕ĂƐǁĞůůĂƐŽŶŐƌĞƐƐ͛ŝŶƚĞŶƚŝŶ ĞƐƚĂďůŝƐŚŝŶŐƚŚĞZ&^ƉƌŽŐƌĂŵ͕͟WƐƚĂƚĞĚ͘ZĞƉƌĞƐĞŶƚĂƟǀĞƐŽĨ the biomass-based diesel industry lauded this about-face by the agency in charge of administering RFS policy. പഩKŶ DĂƌĐŚ ϭϬ͕ ƚŚĞ ƐĂŵĞ day the massive $1.9 trillion American Rescue Plan Act of 2021 passed through Congress on a near party-line vote (one Democrat in the House and all Republicans in both chambers ǀŽƚĞĚŶĂǇͿ͕ƚŚĞ^ĞŶĂƚĞĐŽŶĮƌŵĞĚ President Joe Biden’s pick to lead EPA, Michael Regan, secretary of North Carolina’s Department of ŶǀŝƌŽŶŵĞŶƚĂů YƵĂůŝƚǇ͘ ƵƌŝŶŐ പd A2 o DRǀ PE N Michael Regan ŚŝƐĐŽŶĮƌŵĂƟŽŶŚĞĂƌŝŶŐ͕ZĞŐĂŶƐĂŝĚ͞ƚŚĞZ&^ŝƐĚĞĮŶŝƚĞůǇĂ ƉƌŝŽƌŝƚǇĨŽƌƚŚŝƐĂĚŵŝŶŝƐƚƌĂƟŽŶ͘͟ ŶŽƚŚĞƌŬĞǇƉŽƐŝƟŽŶ ĨŽƌďŝŽĨƵĞů ŝŶƚĞƌĞƐƚƐ͕ƐĞĐƌĞƚĂƌǇŽĨ ĂŐƌŝĐƵůƚƵƌĞ͕ǁĂƐĂůƐŽƌĞĐĞŶƚůǇĮůůĞĚ͘ŝĚĞŶƚĂƉƉĞĚĂƉĞƌƐŽŶǁŚŽ served the same role during eight years under President Barack Obama—Tom Vilsack. The Senate voted overwhelmingly to reinstate Vilsack as head of the US Department of Agriculture ;h^Ϳ͘/ŶŚŝƐĐŽŶĮƌŵĂƟŽŶŚĞĂƌŝŶŐ͕sŝůƐĂĐŬĞŵƉŚĂƐŝǌĞĚƚŚĂƚ ͞ďŝŽĨƵĞůƐĐŽŶƟŶƵĞƚŽƉůĂǇĂƌŽůĞŝŶƌĞĚƵĐŝŶŐĞŵŝƐƐŝŽŶƐĂŶĚ ƉƌŽǀŝĚŝŶŐũŽďŽƉƉŽƌƚƵŶŝƟĞƐŝŶĂůůƉĂƌƚƐŽĨƚŚĞĐŽƵŶƚƌǇ͘͟^ŚŽƌƚůǇ ĂŌĞƌ ŚŝƐ ĐŽŶĮƌŵĂƟŽŶ͕ Ă ďŝƉĂƌƟƐĂŶ ŐƌŽƵƉ ŽĨ ϭϬ ƐĞŶĂƚŽƌƐ͕ ŝŶĐůƵĚŝŶŐŚƵĐŬ'ƌĂƐƐůĞǇ;ZͲ/ͿĂŶĚŵǇ<ůŽďƵĐŚĂƌ;ͲDEͿ͕ ƐĞŶƚsŝůƐĂĐŬĂůĞƩĞƌƵƌŐŝŶŐh^ƚŽĂƐƐŝƐƚďŝŽĨƵĞůƉƌŽĚƵĐĞƌƐ hurt by the pandemic by leveraging Commodity Credit ŽƌƉŽƌĂƟŽŶĨƵŶĚƐĂŶĚŽƚŚĞƌƌĞƐŽƵƌĐĞƐ͘ Meanwhile, as Washington, DC, recalibrates itself on RFS ŝƐƐƵĞƐ͕ĂŶĞǁĂŶĂůǇƐŝƐĨƌŽŵ>ŝĨĞǇĐůĞƐƐŽĐŝĂƚĞƐĨŽƵŶĚƚŚĂƚ ŐƌĞĞŶŚŽƵƐĞŐĂƐ;','ͿĞŵŝƐƐŝŽŶƌĞĚƵĐƟŽŶƐĂĐŚŝĞǀĞĚƵŶĚĞƌ ƚŚĞ Z&^ ƉŽůŝĐǇ ĨĂƌ ĞǆĐĞĞĚĞĚ ǁŚĂƚ W ŽƌŝŐŝŶĂůůǇ ƉƌŽũĞĐƚĞĚ͘ Between 2008 and 2020, the use of biofuels under the RFS ƌĞƐƵůƚĞĚ ŝŶ ĐƵŵƵůĂƟǀĞ ƐĂǀŝŶŐƐ ŽĨ ϵϴϬ ŵŝůůŝŽŶ ŵĞƚƌŝĐ ƚŽŶƐ ŽĨ ĐĂƌďŽŶ ĚŝŽǆŝĚĞͲĞƋƵŝǀĂůĞŶƚ ',' ĞŵŝƐƐŝŽŶƐ͘ KŶĞ ŽĨ ƚŚĞ reasons the savings were greater than originally thought is ďĞĐĂƵƐĞďŝŽĚŝĞƐĞůĂŶĚƌĞŶĞǁĂďůĞĚŝĞƐĞůƐƉĞĐŝĮĐĂůůǇĞǆĐĞĞĚĞĚ ĞǆƉĞĐƚĂƟŽŶƐ͘ Ɛ','ƌĞĚƵĐƟŽŶƐĨƌŽŵƚŚĞZ&^ƌŝƐĞĂďŽǀĞĞǆƉĞĐƚĂƟŽŶƐ͕ prices for the compliance mechanism of the policy—renewable ŝĚĞŶƟĮĐĂƟŽŶŶƵŵďĞƌ;Z/EͿĐƌĞĚŝƚƐͶĂƉƉƌŽĂĐŚĞĚŶĞǁŚŝŐŚƐŝŶ early 2021. RIN prices for biomass-based diesel approached $1.20 a gallon (between 1.5 and 1.7 RINs are generated ƉĞƌŐĂůůŽŶƉƌŽĚƵĐĞĚͿŝŶĞĂƌůǇϮϬϮϭ͘dŚĞŶĞƌŐǇ/ŶĨŽƌŵĂƟŽŶ ĚŵŝŶŝƐƚƌĂƟŽŶ;/ͿƐĂŝĚƚŚĞŝŶĐƌĞĂƐĞǁĂƐůŝŬĞůǇĚƵĞƚŽďŝŽĨƵĞů͛Ɛ per-gallon costs compared to their petroleum counterparts. Following this logic, recent crude oil and diesel fuel price rises should mean a lowering of RIN prices from these highs. Biodiesel Gathering Goes Virtual dŚĞĮƌƐƚͲĞǀĞƌǀŝƌƚƵĂůEĂƟŽŶĂůŝŽĚŝĞƐĞůŽŶĨĞƌĞŶĐĞĂŶĚ ǆƉŽǁĂƐŚĞůĚŝŶ:ĂŶƵĂƌǇĂŶĚŵŽƌĞƚŚĂŶϱϱϬďŝŽĚŝĞƐĞůĂŶĚ renewable diesel producers, distributors, retailers, and other ŝŶĚƵƐƚƌǇĂĚǀŽĐĂƚĞƐĐŽŶǀĞŶĞĚĨŽƌƚŚĞ͞ƌŝƐĞ͟ͲƚŚĞŵĞĚĞǀĞŶƚ͘/Ŷ ŚŝƐŽƉĞŶŝŶŐƌĞŵĂƌŬƐ͕EŚŝĞĨǆĞĐƵƟǀĞKĸĐĞƌ;KͿŽŶŶĞůů ZĞŚĂŐĞŶƌĞŵŝŶĚĞĚĂƩĞŶĚĞĞƐŽĨƚŚĞŶĞǁŝŶĚƵƐƚƌǇǀŝƐŝŽŶůĂŝĚ out last year to achieve 6 billion gallons of biomass-based diesel use in the United States by 2030 and 15 billion gallons by 2050. With all the large-scale renewable diesel projects ƌĞĐĞŶƚůǇĂŶŶŽƵŶĐĞĚ͕ŝŶĂĚĚŝƟŽŶƚŽƚŚĞWƌŽǀŝĚĞŶĐĞZĞƐŽůƵƟŽŶ ƚŽŵŽǀĞŚĞĂƟŶŐŽŝůŝŶƚŚĞEŽƌƚŚĞĂƐƚƚŽŝŽŚĞĂƚŝŶƚŚĞĐŽŵŝŶŐ years, the vision seems highly achievable, but feedstock ůŝŵŝƚĂƟŽŶƐĂƌĞŶŽǁŵŽƌĞƉĂůƉĂďůĞƚŚĂŶĞǀĞƌďĞĨŽƌĞ͘ “The continued growing demand for animal protein ĂůŽŶĞ͕ĚƌŝǀĞŶďǇǁŽƌůĚǁŝĚĞƉŽƉƵůĂƟŽŶŐƌŽǁƚŚ͕ǁŝůůůĞĂĚƚŽ increased fats and oils in the market available for industrial ƵƐĞƐ͕͟ZĞŚĂŐĞŶƐĂŝĚ͘͞KƵƌh^ĨĂƌŵĞƌƐǁŝůůĐŽŶƟŶƵĞƚŽůĞĂĚ ƚŚĞǁĂǇŝŶĨĞĞĚŝŶŐƚŚŝƐŐƌŽǁŝŶŐƉŽƉƵůĂƟŽŶĂŶĚǁĞǁŝůůƵƐĞ ƚŚĞĂĚĚŝƟŽŶĂůĂǀĂŝůĂďŝůŝƚǇŽĨǀĞŐĞƚĂďůĞŽŝůƐ͕ƵƐĞĚĐŽŽŬŝŶŐŽŝů UCO, and animal fats that comes with it. I have no doubt that ǁĞĐĂŶƌĞĂĐŚŽƵƌŐŽĂůƐ͘͟ Teresa Alleman, a senior fuel chemist with National ZĞŶĞǁĂďůĞŶĞƌŐǇ>ĂďŽƌĂƚŽƌǇ;EZ>Ϳ͕ƌĞǀĞĂůĞĚĂƚƚŚĞǀŝƌƚƵĂů event the latest US and Canadian biodiesel fuel quality ƐƵƌǀĞǇƌĞƐƵůƚƐ͘dŚĞƌĞůĂƟǀĞůǇŶĞǁYͲϵϬϬϬƋƵĂůŝƚǇƐƵƌǀĞǇŝƐĂ ĐŽůůĂďŽƌĂƟŽŶďĞƚǁĞĞŶE͕EZ>͕ĂŶĚƉĂƌƟĐŝƉĂƟŶŐYͲϵϬϬϬ biodiesel producers in Canada and the United States. At last year’s biodiesel conference, Alleman shared results from the ĮƌƐƚƐƵĐŚƐƵƌǀĞǇ͕ǁŚŝĐŚĂŶĂůǇǌĞĚĚĂƚĂĨƌŽŵƚŚĞƚǁŽͲǇĞĂƌƉĞƌŝŽĚ ŽĨϮϬϭϳʹϮϬϭϴ͘&ŽƌƚŚĞůĂƚĞƐƚƐƵƌǀĞǇ͕ƉĂƌƟĐŝƉĂƟŶŐĐŽŵƉĂŶŝĞƐ 48 April 2021 Render www.rendermagazine.com /www.rendermagazine.com