The Renewable Chemical Industry Must Speak with One Voice

May 23, 2013 |

EricksonBy Brent Erickson, Executive Vice-President, BIO; head, Industrial Biotechnology & Environment section

Because of biotechnology innovation, the renewable chemical space is quickly becoming a robust part of the biorefinery landscape. BIO and its renewable chemicals companies have fought a long battle to be included in federal policies that support other renewable technologies.

The industry has grown and developed during that effort, with the first few companies beginning to build commercial-scale facilities and more research reaching the pilot stage. Renewable chemicals offer cost-competitiveness with petrochemicals or new properties and features that add value to innovative consumer products. In that way, they’ve captured some market share and created demand. But many renewable chemical companies still face a challenge raising capital necessary for commercialization, and they are at a disadvantage when competing for capital without a level playing field in policy.

Grow it Here, Make it Here

Recently, the industry has gained momentum in being included in federal policies. Last year, Sen. Debbie Stabenow (D-Mich.) expanded her Grow It Here, Make It Here Initiative to help improve access to capital for biomanufacturing. Sen. Stabenow also introduced the Qualifying Renewable Chemical Production Tax Credit Act in 2012, which would provide renewable chemical and biobased products access to tax credits that are available to other industries. Companion legislation was introduced in the House by the bipartisan team of Reps. Bill Pascrell (D-N.J.) and Brian Bilbray (R-Calif.). BIO is backing efforts by both Stabenow and Pascrell to reintroduce the legislation very soon this year.

Sen. Chris Coons (D-Del.) this year introduced a bill that would open up Master Limited Partnership tax structures to renewable technologies, including renewable chemicals. And the Farm Bill legislation passed by the Senate Agriculture Committee and currently being considered by the full Senate also provides eligibility for renewable chemicals companies to participate in the agriculture energy programs.


We hope to see it, along with robust mandatory funding, included in a Farm Bill signed by President Obama this year. These policy proposals acknowledge that the renewable chemical industry can contribute to job creation, economic growth, and the energy security goals of the nation on an equal footing with other renewable technologies.

They also recognize that many of these technologies were developed here in the United States. It’s important that technology commercialization and growth of a renewable chemical industry creates manufacturing opportunities here at home and improves U.S. economic competitiveness.

Keep benefits of R&D at home


If not, the significant benefits of our research and development will be captured by other countries. The U.S. must meet the challenge of competing for a share in the $2.4 trillion worldwide clean energy market and $3.5 trillion global chemicals market. Capturing a percentage of this market will create hundreds of thousands of employment opportunities and shift the balance of trade in the chemical sector.

Now that the renewable chemical industry is beginning to achieve recognition and parity with other renewable technologies, the industry should look to speak with a clear, unified voice. The disunity and proliferation of advanced biofuel groups that occurred in the wake of Congress’ adoption of the Renewable Fuel Standard is a cautionary tale.

Speak with one voice


Individual companies and trade organizations seeking temporary advantage under the rules eroded Congressional support and allowed opponents of the policy to launch a divide-and-conquer strategy. The biofuels industry is now fighting a pitched battle to preserve the RFS.

The advocacy efforts for the renewable chemical industry are proceeding well but are not yet won and the current progress in getting legislation introduced has been made in a very challenging policy environment. The industry needs to speak with one voice and to continue a unified and concerted effort in order to achieve victory.

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