Live Blog from ABM: Policy Outlook 2012 and beyond

October 29, 2012 |

Policy Panel

9:14 am: Some missing characters, as many have been stranded by Hurricane Sandy.

9:17 am: Brooke Coleman is up first, discussing progress over at the Advanced Ethanol Council

9:23 am: The “blueprint for success” is revealed, discussing the difference between one year extensions and comprehensive tax reform

9:29 am : Conservative player said that ethanol has saved us from energy dependence on countries like China

9: 33 am:  Last year, messaging was problematic because micro interfered with macro. Today, messaging is still undergoing “tug-of-war”. Myths need to be combated with reality: biofuels industry is not working in a free market. Fossil fuels still have tremendous amount of advantage, and government is still not giving biofuels industry a fair shot.

9:35 am: It’s hard to convince Washington to give biofuels producer tax credits if they still believe fossil fuels aren’t getting any type of tax credits.

9:36 am: John Pierce takes the stage for the Algae Biomass Organization

9:40 am:  Algae is seeking parity. Money currently coming from Washington for R&D is not enough

9:42 am: Mary Rosenthal will return to the game around November 15th

9:42 am: Mary Solecki takes the stage with E2 (Environmental Entrepreneurs)

9:45 am: E2 is onboard with the RFS, wants to alter kinks in LCFS: changes that would include cost containment method, credit-trading platform (electronic, run by a 3rd party).

9:46 am: Public sector to source demand from renewable sources means 450 million gallons per year.

9:48 am: Mitigating risk of fuel price volatility will be key for industry.

9:50 am: Question phase: CAFE Standards? How does RFS fit in?

               Brooke Coleman: Size of gasoline marketplace is not a problem, it’s the access to it that gives us issues. CAFE gives incentives to use certain types of vehicles, but not flex-fuel vehicles: affects our marketplace. Component of ethanol blending, more ethanol use allows higher fuel efficiency per dollar invested: we need to know whether we are going to be using E10, E15, etc as we develop biofuels cars.

9:54 am: How has California’s state policy towards biofuels played in?

              Mary Solecki: This election, “states can do it better”: political reality is that policies have very little effect if they are isolated; key will be developing uniform federal policy so there is no leakage.

9:56 am: What about low carbon fuels standard?

Mary Solecki: U.S. Appeals court decision will come out next year because of reassignment due to the death of a judge. We need to implement LCFS as it currently stands. Sacramento is trying to get rid of LCFS.

Brooke Coleman: This is a great policy, but carbon-counting mechanisms California is using must treat every fuel equally. Ramp to national adoption if only liberal states are supporting programs like this. LCFS does not pick winners, only cares about carbon performance: this is the cohesion we need. Indirect land use change is very controversial and plays a huge role in California. Took corn ethanol out because it is not durable, but must come back to table and get people on the same page for carbon accounting.

Mary Solecki: If we’re going to support LCFS, large scale carbon accounting issues will cannibalize industry. Corn ethanol is being blended in order to meet compliance targets.

10:02 am: How do we create a durable standard that allows for innovation, so we get stability, but we don’t lock out advantageous developments?

John Pierce: Some don’t want to cooperate with algae, so the tactic has been to appeal to broader base of interests and to support other groups, some as they advocate to open up RFS. Algae cannot get support from BCAP (Biomass Crop Assistance Program): ABO would like to work with E2 to open this up. USDA would like to see this.

 10:07 am: One simple letter to a handful of people times 300 would get bigger response, so what about targeting one reporter, one story, one collective case? What can the grassroots individual do today to start influencing?

Mary Solecki: Companies can’t just focus on developing technology, must also be involved at political level. Be involved with industry organization, sending letters is a good idea.

John Pierce: Politicans tend to be impressed with individual’s efforts, to name a few Brian Bilbray, Merkley, Duncan Hunter, Pierce, Tom Udall, Mark Udall, Harkin, Nelson, Baucus, Ray Mabus

Brooke Coleman: Grassroots and letter writing is very important.

10:13 am: What role will EU and European policy play in the US?

Brooke Coleman: Global competitiveness is huge issue in the US, especially in competition with China, Brazil. So far, EU policy hasn’t had too much impact because RFS is close to finished regarding conventional biofuels.

John Pierce: Tariffs and flight policy is driving a great deal of business dealings of companies like Boeing, so perhaps private sector will feel impact much more. Defense alliances with Australia, Canada, Southeast Asia, so everyone will go where we go: volumetric impact of that will be huge.

10:17 am: What will happen in the lame duck?

Brooke Coleman: Senate is annoyed that House hasn’t done a Farm Bill. Cantor is saying they will get it done. Lame duck will depend on outcome of election. House doesn’t want to talk energy, Senate does (including in Senate Finance Committee). Lame duck won’t happen as much if democrats pull through because tax cuts won’t be an issue. AEC is optimistic that biofuels will stay on books through the end of the year.

Mary Solecki: Will be lamest duck. We’ll see what happens with election.

John Pierce: If Romney is elected, will it happen? If Obama is elected, where will the money come from?

Brooke Coleman: Tax incentives come off books, we’ll have to try and get back on the books, which will be much more difficult. We can’t continue to compete with current corporate tax structure: this is clear on both sides of the aisle. Worry is that by 2013, we need to get messaging on track, otherwise reform will look like elimination of tax incentives.

Mary Solecki: Must further explore military as partner.

10:25 am: What about the DPA? What impact will coal have?

John Pierce: Never seen coal to liquids that really works out; nothing is static, but that industry has a long way to go as well because it is not economically feasible. Natural gas to jet fuel developments will displace coal to liquids.

Mary Solecki: Entry of coal to liquids technology into the market makes the case for life-cycle accounting to be included in policymaking.

10:28 am: Can biochemicals be viewed as a hedge against RFS? How do biochemicals play out in context of biobased materials, natural gas?

John Pierce: Industry financiers favor multiple product tracts. DOE, local or municipal funding will be favorable for multi-product platform, including biochemical products. For example, if you’re taking care of a waste stream, or if you are deriving lipids. Balanced production approach is hugely important.

10:31 am: What feedstock pathways are most important to look into for RFS?

Brooke Coleman: Pushing hard to get EPA to say yes to algae, all other pathways. Increasing receptivity towards opening up RIN definitions.

John Pierce: Using biodiesel for firming power for wind or solar broadens market, which will lead to more opportunity.

Mary Solecki: Jet fuels as a pathway is interesting, especially with Department of Defense.

 

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