Review: The 2016 California Biodiesel Conference in Sacramento

By The California Biodiesel Alliance | March 04, 2016

The 2016 California Biodiesel Conference, held Feb. 24 in Sacramento, presented a range of detailed policy and technical information that was first put into context in a powerful opening address by Jennifer Case, chair of the California Biodiesel Alliance. Case, who is also president of New Leaf Biofuel, a small biodiesel producer in San Diego that has survived tough times in the California market, ended her talk with a David vs. Goliath analogy, predicting that renewable energy will prevail against opposition from the industry with the fuel so old it’s called “fossil,” because renewable is where the innovation, jobs, opportunity and passion are.

Case discussed biodiesel’s policy successes leading toward regulatory stability—including the two-year renewal of the federal tax incentive and healthy renewable fuel standard (RFS) volumes and CBA’s legislative successes, especially solving a long-standing biodiesel tax problem in the state. She then set the stage in a strong way for the first panel, the keynote presentation, and discussions throughout the day when she expressed the concern that of the approximately 275 million gallons of diesel alternatives consumed in California in 2015, only 12 percent came from in-state producers. “We are enjoying the environmental benefits of the low carbon fuel standard (LCFS), but the vast majority of the economic benefit is being enjoyed by South America, Asia, and other parts of the United States,” she said. 

The California Biofuels Cap and Trade Initiative, a coalition effort to secure $210 million from auction proceeds for in-state biofuels production and infrastructure to help solve this problem, was discussed on a panel moderated by CBA lobbyist Louie Brown. Russ Teall, president and founder of Biodico, explained that the funds would be split equally among three biofuel types (diesel alternatives, gasoline alternatives and biogas/syngas) based upon stimulating (1) California-based biofuel production; (2) the low carbon intensity of biofuels, and (3) the benefits to disadvantaged California communities. The other panelists listed the biofuels initiative as among their group’s policy priorities for 2016 and highlighted the effort’s early success in securing $40 million in production incentives to the California Air Resources Board and $25 million in grants to the California energy Commission.

Panelist Julia Levin, executive director of the Bioenergy Association of California, detailed the very broad range of benefits of biogas for renewable energy and very low carbon fuels, which include reducing GHG emissions and short-lived climate pollutants, air and water pollution, petroleum and natural gas use, landfilling and more. Consultant Duncan McFetrich spoke about ethanol, which has five in-state plants producing 222 MMgy, and contributes 50 percent of the total carbon reduction under LCFS with CI scores that are consistently declining. Ryan Kenny, senior public policy and regulatory affairs advisor for Clean Energy, discussed its Redeem-branded renewable natural gas (RNG), which is the first commercially available RNG and is made entirely from organic waste. Johannes Escudero, executive director of the Coalition for Renewable Natural Gas, which advocates for renewable natural gas derived from cellulosic waste sources though public policy advocacy and education, said that California has an opportunity to lead the nation in a field with vast potential and carbon intensities scores that plunge below minus 200.

The panel entitled “California’s Regulatory Environment and Future Directions” was moderated by Joe Gershen, founder and president of Encore BioRenewables. It featured Cliff Rechtschaffen, senior advisor to Gov. Brown, who spoke about the governor’s integrated plan to address climate change by reducing greenhouse gas (GHG) emissions by 40 percent by 2030. Citing the “Planting Fuels” study (see below) that California producers provide less than 20 percent of the state’s low carbon fuels, he outlined the requirements for funding by ARB through the Greenhouse Gas Reduction Fund and the CEC under AB 118; acknowledged biofuels industry success so far; and stressed the competitive nature of the process of funds allocation.

Floyd Vergara, ARB’s industrial strategies division chief, focused on the success of LCFS and how the alternative diesel fuel (ADF) regulation fits into that program’s goals while providing a path forward for the biodiesel industry as the agency’s concerns about NOx emissions are addressed. Tim Olson, energy resources manager at the CEC, provided a thorough overview of relevant CEC issues and mobile source incentive programs. His conclusions included a “strong potential to increase the use of low carbon intensity feedstocks in California” and a “proposed state government biofuel incentives increase to $85 million annually from $20 million.” Responding to inquiries about the need for terminal infrastructure funding to address the biodiesel industry’s distribution bottleneck, he said that industry would have to demonstrate a need for government incentives for blending terminals.

Keynote speaker Ethan Elkind, associate director of the Climate Change and Business Research Initiative at the UC Berkeley School of Law’s Center for Law, Energy and the Environment, joint appointment at UCLA School of Law, reiterated the need for a biofuels production incentive as one of many broad-reaching steps delineated in the law schools’ well-received joint report, “Planting Fuels: How California Can Boost Local, Low-Carbon Biofuel Production.”

Joe Jobe, CEO of the National Biodiesel Board and featured speaker, urged grassroots engagement, especially vigilance against RFS attacks, many of which are focused on the ethanol blendwall but present risks for the entire program, even though advanced biofuels such as biodiesel have strong bipartisan support across regional boundaries, as well as in the Obama administration.

A moderated discussion, “Regional Clean Fuel Standards: Progress Toward Adoption, Compliance and Integration,” led by Harry Simpson of Crimson Renewable Energy, began with several propositions. First was that in order to develop regional/inter-jurisdictional LCFS markets in which LCFS credits are fungible, a high level of integrity within each LCFS program/jurisdiction and a corresponding high level of market confidence in the integrity of LCFS credits must exist. Second was that California’s upcoming verification and enforcement rulemaking to address these issues will be the model for other jurisdictions.  

Panel participants Sam Wade, ARB’s transportation fuels branch chief; Shelby Neal, director of state governmental affairs with NBB; and Ian Thomson, president of Advanced Biofuels Canada, discussed their thoughts on the most critical issues regarding LCFS verification and enforcement. Some of the common themes that emerged included (1) the importance of feedstock testing as part of unannounced on-site inspections; (2) the need for third-party auditors to be U.S. companies and individuals to ensure enforceability of judgments; (3) the need for bonding requirements for foreign producers similar to the RFS, and (4) sharing data between LCFS jurisdiction to prevent mass-balance misrepresentation.

Curtis Wright, Imperial Western Products’ Biotane fuels division manager, moderated a panel entitled “The Future of California Biodiesel Feedstocks.” Paul Roos, a special investigator with the California Department of Food and Agriculture, discussed the transportation documentation/manifests requirements of his agency’s inedible kitchen grease program, which has proven to be a very successful tool in helping to solve the crippling problem of grease theft in the state.

Stephen Kaffka with the plant sciences department at UC Davis, discussed how, with continued research and extension support, biodiesel feedstocks can be sourced from farms in California with possible opportunities for new oilseed production in orchards and vineyards, in dry farming systems and with increased winter annual production as a complement to increased woody perennial plantings in the state. J. Alan Weber, NBB senior advisor, talked about national trends, including that animal fat use for biodiesel production is up, and presented some of the detailing models used in this increasingly sophisticated science. Anil Prabhu, manager of ARB’s fuels evaluation section, updated the audience on ARB’s progress in reviewing biodiesel pathways applications under the newly readopted LCFS. He confirmed the expected release date for new CI scores of June 30, 2016. There are 63 Tier 1 and 7 Tier 2 applications for certification and 25 Tier 1 and 1 Tier 2 for recertification.

Sponsors of the event include the NBB and Renewable Energy Group Inc. (gold); Crimson Renewable Energy and EcoEngineers (silver); and Biodico and The Jacobsen (bronze).

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