Memphis Biofuels calls for expanded biodiesel support

Ken Arnold, CEO and president of Memphis Biofuels LLC, sought support for two enhancements to federal legislation in a letter emailed April 6 to members of the biodiesel industry. Arnold called for the national Renewable Fuels Standard goal for biodiesel be raised to at least 1 billion gallons by 2010, two years earlier than the RFS passed in the last energy bill. "Though the domestic biodiesel industry has the capacity to produce in excess of 1 billion gallons of fuel a year, the RFS only calls for the domestic production of 500 million gallons in 2009, and 1 billion gallons by 2012," Arnold said. "Moreover, implementation of even that weak mandate has been delayed by a White House review of the Environmental Production Agency's proposed rule."

His second recommendation was to redirect the biodiesel subsidy. "Current federal law offers a $1 per gallon subsidy to blenders who mix conventional fossil fuel with biodiesel. If that subsidy were instead switched to the producers of biodiesel, it would more effectively underpin the entities that have invested the risk capital, built the manufacturing infrastructure, and created the incremental jobs in this vital industry."

"Neither of these tweaks are particularly sensitive politically," Arnold wrote. "Neither would cost the U.S. government additional money. Implementing them both would go a long way toward bolstering a nascent domestic industry while making real strides toward attaining energy independence, which everyone in this country wants."

Memphis Biofuels has a 36 MMgy facility that has run only intermittently since last summer, Arnold said. He sent the email out hoping to build support for measures to help the hemorrhaging biodiesel industry. He will be making a trip to Washington D.C. early in April to meet with Congressional members about measures to help the industry. It will be his first trip since the change in administrations. "There may be a will to do something, but whether there's the will to do it now with all the other things going on is a question," he said.

Arnold admitted there are those who will not support an increase in the RFS for biodiesel, saying there isn't enough feedstock available. He argued that if the nation waits until the industry says it's ready, "we'll never get there." He pointed to the automobile industry's reluctance to move faster on emissions controls as an example. "We need government and Congress to push these things along."