I'm No Protectionist, but...

By Ron Kotrba | March 30, 2011
Have you ever looked back on a period of time in your life-a day, week or month-and thought that it flew by and yet seemed like an eternity? It's not logical to perceive both scenarios at the same time, and yet I had that experience recently.

The eight days between Feb. 3, when the announcement was made that U.S. EPA had issued its final rule on RFS2 implementation, and Feb. 10, the close of this year's National Biodiesel Conference & Expo, seemed like an eternity. Usually when people are busy, time seems to fly and in one sense, it did. In another sense, however, with so much information on the final rule, the tax credit and other news made those eight days seem much longer than a week.

Having been to the past five National Biodiesel Conferences, it was clear to me this year in Grapevine, Texas, that the industry was worse off than ever before. The economy and lapse of the federal blender tax credit have taken their toll on producers. Attendance was down and there were far fewer exhibit booths in the expo hall, as evidenced by wide open spaces on the tradeshow floor. There were no celebrities this year either-no Willie Nelson, or Merle Haggard, or Melissa Etheridge. Not even Darryl Hannah.

Aside from the tax credit situation and the poor economy, producers and others in the biodiesel business desperately sought information on RFS2. Associate editor Nicholas Zeman and I cover the conference in a double-length review article, called, "Seeking Answers," featured on page 22. Since we produced nearly 4,000 words in our review of the conference, I'll spare the reiteration of what you can find just pages from this column.

There is one particular aspect of RFS2 whose underlying logic I fail to understand. RFS2 was passed as part of the Energy Independence and Security Act of 2007, signed by President George W. Bush. The act was a move to decrease our dependence on foreign oil and make our energy future more secure. Replacing liquid petroleum fuels whose crude oil feedstock by and large comes from lands afar with domestic renewable fuels seems like a no brainer. It's a great concept.

However, if EISA is about energy independence and security, why is EPA allowing imported biodiesel and biodiesel made from imported feedstock to qualify for the RFS2 program? It doesn't make sense to me. I asked this question of Dan O'Connor with (S&T)2 Consultants, who presented during a breakout session on RFS2. His response was that it provides diversity to our energy supply. That sounds okay, but the act is not called the energy diversity act.

I understand that trade is global and there is no reason to be a modern-day protectionist. I also see that it is a good thing to do whatever we can to reduce oil imports from the Middle East, Venezuela and other hostile regions whose citizens and governments want us dead. But the scenario of shipping biodiesel to the U.S. from Malaysia or India to satisfy a federal mandate while domestic producers are out of business because Congress cannot bring itself to do the right thing and reissue the biodiesel tax credit borders on absurdity.
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