Obama Sets Biofuels Plan In Motion

President Barack Obama has announced steps his administration is taking to advance biofuels research and commercialization. What retailers need to know.

As of May 5, he has established a Biofuels Interagency Working Group, added Recovery Act funding for renewable fuel projects, and provided notice of a proposed rulemaking on the Renewable Fuel Standard (RFS).

In a memorandum, Obama requires EPA, USDA, and the Department of Energy to better coordinate efforts to expand the production and use of biofuels beyond corn-based ethanol.

The President also announced EPA’s Notice of Proposed Rulemaking on the Renewable Fuel Standards. EPA Administrator Lisa Jackson says her agency will establish four categories of renewable fuels — cellulosic biofuels, biomass-based diesel, advanced biofuels, and total renewable fuels.Some of these will be produced from new sources.

The proposal would require 36 billion gallons annually of renewable fuels, of which 16 billion gallons must be cellulosic biofuels; and 1 billion gallons must be of biomass-based diesel. At most 15 billion gallons of the renewable fuel mandate can be met with conventional biofuels, including corn-based ethanol.

For the first time, some renewable fuels must achieve greenhouse gas emission reductions compared to the gasoline and diesel fuels they displace. Refiners must meet the requirements to receive credit toward meeting the new standards.

EPA also will conduct peer reviews on the lifecycle-analysis methodology and the results for various fuels and feed-source combinations. Lifecycle refers to the greenhouse gas emissions over the life of the fuels.

President Obama has directed Agriculture Secretary Tom Vilsack to expedite and increase production of and investment in biofuel development efforts by:

  • Refinancing existing investments in renewable fuels to preserve jobs in ethanol and biodiesel plants, renewable electricity generation plants, and other supporting industries.
  • Making renewable energy financing opportunities from the Food, Conservation and Energy Act of 2008 available within 30 days.

These financing opportunities include:

  • Loan guarantees for the development, construction, and retrofitting of commercial scale biorefineries and grants to help pay for the development and construction costs of demonstration-scale biorefineries.
  • Expedited funding to encourage biorefineries to replace the use of fossil fuels in plant operations by installing new biomass energy systems or producing new energy from renewable biomass.
  • Expedited funding to biofuels producers to encourage production of next-generation biofuels from biomass and other non-corn feedstocks.
  • Expansion of Renewable Energy Systems and Energy Efficiency Improvements Program, which has been renamed the Rural Energy for America Program, to include hydroelectric source technologies, energy audits, and higher loan guarantee limits.
  • Guidance and support for collection, harvest, storage, and transportation assistance for eligible materials for use in biomass conversion facilities.
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