U.S. EPA proposes to allow additional biofuel pathways

The U.S. Environmental Protection Agency (EPA) is proposing to allow additional biofuel pathways such as biogas to qualify for its renewable fuel standard (RFS) cellulosic production targets in a bid to help fuel producers meet the ambitious goals.
While biofuel supporters welcomed the EPA’s release of the rule, which had been under White House Office of Management and Budget review since October 23, 2012, they note that the time it will take to make the RFS pathway rule final will delay investment in advanced and cellulosic biofuels production facilities. Sources say the EPA is unlikely to finalize the rule until this fall, so it will not affect fuel production this year.
The proposal, which the EPA’s Office of Transportation & Air Quality released on May 20, 2013, ahead of its publication in the Federal Register, would allow several new feedstocks for cellulosic biofuel production under the RFS.
The goal is to try and spur more diversity among the types of renewable fuels that can count toward meeting the RFS cellulosic goal, including the use of biogas from landfills to produce electricity for use in electric vehicles (EV), the agency says. Other qualifying fuels include blends of butanol that achieve major greenhouse gas cuts.
The rule will boost the supply of renewable identification number (RIN) credits, which are needed for refiners to comply with the RFS.
RINs for cellulosic biofuels have been in short supply, with zero being generated thus far in 2013. As a result, refiners have been forced to pay millions of dollars for compliance credits, which has lead the oil industry to seek court review of the requirements while launching an effort for Congress to repeal the RFS. Refiners argue that they should not be forced to blend the advanced biofuels because none is being produced at commercial scale.
The proposed rule would designate renewable diesel, renewable naphtha, renewable electricity for use in EVs when produced from landfill gas, and renewable compressed natural gas (CNG) and liquefied natural gas (LNG) from biogas as qualifying as cellulosic fuel under the RFS, according to an EPA fact sheet.
“[The] EPA is also proposing to allow butanol that meets the 50% [greenhouse gas] emission reduction threshold to qualify as advanced biofuel,” reads the fact sheet, referencing an RFS mandate that the life cycle emissions of advanced biofuels be 50% lower than that of fossil fuels.
The rule also “proposes a clarification regarding the definition of crop residue to include corn kernel fiber and proposes an approach to determining the volume of cellulosic [RINs] produced from various feedstocks.”
Observers say the advanced biofuels industry is urging the EPA to issue several other rules that have been held up for more than a year that also have direct bearing on the advanced biofuels industry, including a final rule on renewable heating fuel, a rule on palm oil, and others that would qualify new biofuel pathways for the RFS.
Sources also say the impact of the rule is not as useful without clarification on the 2013 RFS requirements — mandates that the agency has yet to finalize. The 2013 blending requirements were due in October 2012, but the industry is still waiting for them to be finalized even though half of the year has elapsed.
Still, observers note that the EPA’s proposal includes an important clarification on the use of butanol in the commercial fuel pool, including its combined use with widely available E10. Butanol is widely seen as the advanced biofuel with the most commercial potential, with facilities expected to begin production as soon as this year.
The clarification is important because it allows butanol and E10 to be used together for meeting the RFS, which could open a large market for the advanced biofuel as a replacement for gasoline. Butanol is a so-called drop-in fuel that can be used directly in the fuel system without modification.
(May 21, 2013)