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California's Biodiesel Industry

 
In 2016, in-state biodiesel production rose to over almost 39 million gallons. California currently has 9 biodiesel production plants, with several plants under construction or undergoing expansion. The nine plants are operated by: Agron, Biodico, Buster Biofuels, New Leaf Biofuel, Community Fuels, Crimson Renewable Energy, IWP, GeoGreen, and Simple Fuels.

The total gallons of biodiesel reported sold in California under the LCFS program in 2016 was 163,000 up from 126,450,435 in 2015.



Argus California Carbon & LCFS Summit
October 9-11, 2017
Napa Valley, California

Argus Conference 2017

Don't miss the leading West Coast fuels and carbon event of the year! Join over 250 of your peers in Napa this October to network and gain crucial insight on California's fuels and carbon markets, as well as other North American fuels and emissions programs.

Visit http://www.argusmedia.com/California-Carbon to register and find out more.



SAVE THE DATE!

California Biodiesel Conference

Capitol Ballroom, Sacramento
March 1, 2018

 


Biodiesel is an advanced biofuel made from waste or virgin vegetable oils or animal fats. It is a sustainable, cleaner-burning, diesel fuel replacement that meets strict quality specifications. Biodiesel derived from waste can reduce greenhouse gas emissions by 80% or more.




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Join Us to Access Key Industry Information
Now Made Available to Members Only

 
Opportunities abound, but the word "challenging" is an understatement when it comes to describing the regulatory landscape for biodiesel in California. Those doing or seeking to do business in the state are faced with an array of complex compliance requirements and a dynamic policy environment. Key rulemakings are underway now.

CBA has worked to solve regulatory challenges and has brought the information about this policy work to the public as articles and updates in our newsletter and on our website since both were first published in 2011. CBA will now provide access to a broader range of detailed information, including compliance requirements not previously presented here -- and not gathered together anywhere else -- on our new webpage for Members Only.

Please review our Join Us page for rates and other details about becoming a CBA member or a Partner Sponsor if you are a vendor/service provider.

Alternative Diesel Fuel Regulation (ADF) Affects All Who Handle Biodiesel in CA

 
The ADF regulation, which became effective January 1, 2016, affects all those who handle biodiesel in the state. It prohibited blends above B20 for sale or use in engines as of that date (without an Executive Order from ARB) and required new reporting and recordkeeping as well. Biodiesel producers, importers and blenders are required to submit quarterly reports. Biodiesel producers, importers and blenders are required to report and keep records concerning biodiesel production, sales, and blending. Biodiesel distributors and retailers are only required to keep records.

The National Biodiesel Board has received certification from the California Air Resources board for the additive VESTA™1000 to meet new NOx mitigation requirements that will begin January 1, 2018 under the ADF. A draft FAQ and Reporting Form for those new requirements are being developed by ARB staff.

Find the current FAQ and Reporting Forms at: http://www.arb.ca.gov/fuels/adf/adfdocs.htm.

The presentation for the May 23rd meeting, which has helpful diagrams, is here: http://www.arb.ca.gov/fuels/diesel/altdiesel/meetings/meetings.htm.

CBA members have access to an ADF Summary document, which provides an overview of the regulation with background and Q and As.


Industry Engagement in LCFS Rulemaking

 
CBA and the National Biodiesel Board (NBB) are engaged with ARB staff on a variety of issues, including those related to the agency's planned staff review of the LCFS. This includes providing feedback on the proposed new CA GREET model and the proposed standard defaults for inputs, including methanol and catalyst, as well as the financial significance of very small differences in CI scores.

With NBB, CBA has submitted several joint comment letters arguing for a "QAP+LCFS" compliance approach, which would dramatically reduce costs for the industry and California fuel consumers, and responding to ARB requests for input on specific issues.

CBA members receive updates on the progress of this rulemaking in the monthly newsletter and on the Members Only webpage. Public comment letters are posted here: http://www.arb.ca.gov/fuels/lcfs/workshops/feedback.htm#06022016.

ARB's LCFS meetings page has details and updated presentations: http://www.arb.ca.gov/fuels/lcfs/lcfs_meetings/lcfs_meetings.htm#06022016.


Court Ruling in POET Case Freezes Diesel Compliance at 2017 Levels
Keeps LCFS and Alternative Diesel Fuel Regulation in Place

 
The 5th District Court of Appeals heard oral arguments in the case of POET v. ARB on March 23rd, 2017. The attorneys for POET argued that the California Air Resources Board (ARB) acted in bad faith by not completely addressing the CEQA violations as directed by the Court and sought a suspension of the LCFS to 2013 levels and a complete severance of biodiesel from the regulation.

The Attorney General's office, representing ARB, argued that ARB did act in good faith by adopting the Alternative Diesel Fuel regulation and disclosing through numerous public hearings the NOx issues related to biodiesel. The Attorney General argued POET's remedy would harm the biodiesel industry and others who are not to blame for the unintended mistakes of the ARB. She also argued POET's remedy would have negative impacts on the environment. The Attorney General requested the Court to request ARB to address the needed corrections in a timely fashion with no changes to the LCFS. In the alternative, the Attorney General argued that ARB could suspend LCFS credits for biodiesel for the remainder of 2017 and leave the other elements of the LCFS intact, giving the ARB enough time to address the remaining CEQA violations.

National Biodiesel Board CEO Donnell Rehagen had this to say, "The California Air Resources Board has worked hard over the past several years to create a program that is now successfully bringing cleaner fuels into the marketplace. Biodiesel is a clean, American-made fuel that has dramatic emissions benefits. Under the Low Carbon Fuel Standard, credits generated from biodiesel comprise about a quarter of overall program compliance. Unfortunately, this lawsuit appears to be far more about market share for specific companies than clean air for Californians."

On April 10, 2017, the court, issued its decision.  In that case, POET appealed the lower court’s finding that CARB complied with an earlier order to review and mitigate, as necessary, NOx emissions from biodiesel under the original Low Carbon Fuel Standard (LCFS).  CARB had argued that it properly reviewed and mitigated NOx emissions when it re-adopted the LCFS in 2015 and promulgated the alternative diesel fuel (ADF) rule.

As indicated in a tentative ruling it issued, the Appellate Court did find fault with CARB’s review of NOx emissions and determined that CARB must take additional corrective action.   However, the Appellate Court did not return the LCFS to 2013 levels (as requested by POET) nor did it invalidate the re-adopted LCFS.  It also did not sever biodiesel only from the LCFS program, despite requesting additional briefing on such a remedy.  Rather, the Court found the LCFS should remain operative, except that the standards for diesel fuel and its substitutes (e.g. biodiesel) would remain at the requirements for 2017 until CARB takes corrective action and such action is approved by the lower court. The Alternative Diesel Fuel (ADF) rule also remains in place.  CARB still has an opportunity to seek an appeal of the Appellate Court’s finding of a violation to the State Supreme Court.

It is CBA's understanding that the court's ruling freezes the compliance requirement for diesel at 2017 levels but that biodiesel can be used for compliance on the same basis as other LCFS fuels.