Biodiesel producers have idled production in the face of a weak RFS proposal.
Results from a nationwide survey of biodiesel producers released this week revealed that nearly 80 percent of U.S. biodiesel producers have scaled back production this year. More than half have idled production at a plant altogether. The survey was conducted by the National Biodiesel Board (NBB).
The cutbacks come in the face of a weak Renewable Fuel Standard (RFS) proposal from the EPA and Congress’s failure to extend the biodiesel tax incentive, the NBB reported.
The RFS proposal, which has not yet been finalized, would establish a biodiesel standard of 1.28 billion gallons this year, a deep cut from last year’s record production of nearly 1.8 billion gallons. This would likely force many producers to shut their doors, the NBB reported.
The biodiesel tax incentive expired on January 1, the third time in five years that Congress has allowed it to lapse. The incentive is included in the tax extenders bill currently under consideration in the Senate, but remains unclear when or if the incentive might be reinstated.
Biodiesel producers and other advocates joined a group of U.S. senators at a press conference this week calling for Congress and the Administration to act quickly to support a strong RFS and reinstate the tax incentive.
“Inconsistency in Washington is wreaking havoc on the U.S. biodiesel industry,” said Anne Steckel, NBB’s vice president of federal affairs. “It’s not just hurting these producers. It is a setback for local economies where these plants operate, for our environment, for our national energy security, and for drivers who are tired of ever-increasing fuel prices that result from the petroleum industry’s monopoly at the pump.”
“Biodiesel has proven itself to be a successful homegrown fuel,” said Bryan Christjansen, general manager of the Renewable Energy Group’s refineries in Albert Lea, Minn. and Mason City, Iowa. “If the administration chooses to go with the EPA proposal, it does not just put domestic fuel production in jeopardy, it harms local economies and billions of dollars of investments.”
“This uncertainty is bad for producers, it’s bad for agriculture, it’s extremely bad for investors, it’s bad for the environment, and it’s particularly bad for those of us who took cues from Congress and the Administration and made the commitments to build a U.S. renewable fuels future,” said Terry Goerger, a seed company owner and third-generation farmer from Mantador, N.D.
Senstor Maria Cantwell (D-Wash) has introduced bipartisan legislation to give businesses the certainty they need to invest in the development of affordable, domestic alternatives to fossil fuels.”
The survey of NBB members was conducted in April. Fifty-four biodiesel producers participated in the survey.
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