Ready to Roll: EPA Issues Final Renewable Fuel Standard Rules

The Environmental Protection Agency this month issued final rules for the federal Renewable Fuel Standard. The biofuels industry now must step up production to meet the aggressive targets for producing cellulosic biofuels in the coming years.

To that end, the Obama administration has suggested a new course and funding strategy intended to support biofuels production. “I want to be clear that my administration is following a nonideological approach to this issue,” President Obama said this month at a meeting of the nation’s governors in Washington. “We believe in a strategy of more production, more efficiency and more incentives for clean energy.”

While Obama lauded the new RFS rules, his Biofuels Interagency Working Group also noted in a report that the nation is “not on a trajectory to reach the Congressional 36 billion gallons per year goal by 2022,” mandated by the Energy Independence and Security Act of 2007.

That’s despite the current annual production of 12 billion gallons of biofuels (mainly corn grain ethanol).

“To reach and exceed our biofuels targets, we will need to take a new strategic approach that continues to support the existing biofuels industry and accelerates the creation and rapid commercial deployment of new technologies,” the working group said.

The administration’s strategy aims to increase U.S. renewable fuels production and convert biomass into bioenergy.

In its report, the Biofuels Interagency Group recommends three steps to help ramp up biofuels production:

1. Improve current delivery programs to support current generation and advanced biofuels technologies.
2. Streamline strategies that move technology R&D rapidly to a pilot demonstration phase and to construction of full-scale commercial production facilities.
3. Support development of new uses and markets that rely on the existing ethanol infrastructure and other vertically produced, value-added biofuels co-products.

“The Obama administration clearly recognizes that large-scale production of advanced biofuels can be a driver of green job creation, energy security and greenhouse gas reductions,” says Jim Greenwood, BIO president and CEO. “This new initiative will send a message to the industry and potential investors that the federal government is strongly committed to achieving advanced biofuels production and use targets.”

But more must be done to make investment in production facilities less risky, adds Brent Erickson, executive vice president of BIO’s Industrial and Environmental Section. For that to take place, Congress needs to act as well, he says.

BIO recommends that Congress enact the following new policies to ensure that the country can achieve the RFS production targets:

1. Revise the risk assessment process for advanced biofuels projects in the current Energy Department Loan Guarantee Program.
2. Double funding for Agriculture Department programs that deploy cellulosic feedstocks and include eligibility for value-added, bio-based materials, products and chemicals.
3. Fund reverse auctions for cellulosic biofuels that have already been approved.
4. Fund development and deployment programs for bio-based products and renewable specialty chemicals.