Heard on the Floor: Alleluias and Vision 2020 at the National Biodiesel Conference

January 22, 2020 |

I thought I would never hear concentrated joy as at the evangelical churches of my childhood, on Easter morning, when the faithful sang “Christ The Lord Is Risen Today” — and then I arrived at the 2020 National Biodiesel Conference & Expo. 

This year’s conference theme was simple and bold enough, Vision 2020. But it could have been summed up even more succinctly: “Alleluia”.

The people of the biodiesel industry are not given to public displays of emotion, so cast aside any hopes for photographs of the laying on of hands, or audio of speaking in tongues, but the rapture was there all right, in the quieter way that the champions of America’s favorite advanced biofuel carry themselves.

Who could begrudge them an alleluia, or a Praise Jesus or two? They have been three years in the valley of the shadow of Death, and have emerged on the other side with huge wins in recent weeks on tax credits, progress on Argentine and China trade, and a promise from the EPA on small refinery waivers (we have yet to see the redemption of, ahem).

A few weeks ago, even these hardy and flinty bioindustrialists, who have improbably built an industry in the shadow of ethanol, the wake of DieselGate, and despite the best efforts of the Emitters Protection Agency to scuttle them, were showing a few hearts on the sleeve.

“When we heard about it,” Kayla Tilton and reminisced about the night the news came through on tax, “we were high fiving, there were tears.” The student from National University, doubling as a data specialist at Maine Standard Biofuels, told of the surprise that overtook what had been planned as a holiday-time staff party and turned it into a celebration. 

Throughout the opening main stage morning, delegates recalled their experience of the news of the tax deal, as if they were recalling where they stood when Neil Armstrong stepped onto the moon, or when the Boston Red Sox lifted the Curse of teh Bambino in 2004. 

The crowd was smaller for the NBB show this year, just 303 were on hand for the opening plenary session, testament to the multiple plant closures that swept across the industry in the bleak fall that the biodiesel industry had struggled through. NBB CEO Donnell Rehagen recalled on stage preparing for a board meeting in November and wishing that 2019 could be put in the rear view mirror as soon as possible. 

So amidst the feelings of relief, the industry was quick to gird itself against complacency, and Rehagen exhorted the industry to set new goals and reach new heights, and to maintain vigilance on trade and the Renewable Fuel Standard.

Rehagen unveiled a new tagline and new goals. 6 billion gallons by 2030, 15 billion gallons by 2050. “Biodiesel. Better. Cleaner. Now!”. It’s a vision, and a plan, on messaging, positioning and production. You can learn all about it here.

“The job is not done,” Rehagen warned, “we must turn to the RFS, and to state and regional carbon policies taking shape.”

Elsewhere on the floor, delegates were buzzing about trade, climate action based around biodiesel’s ultra-low carbon scores, and project status.

REG, Phillips 66 nix proposed Washington state renewable diesel project

Originally announced in fall 2018, this 250 million gallon per year project aimed at the Phillips 66 refinery in Ferndale Washington would have resulted in the largest renewable diesel refinery on the West Coast. Though styled as a joint decision — in the nature of a JV — this one was, we hear, a Phillips 66 call.

The culprit? Permitting delays. Not the kind that cost you months. A debilitating avalanche of almost inexplicable roadblocks have been thrown up against a project that, essentially, does no more than install a new unit on an existing refinery footprint, and begins to transform an all-fossil refinery into the world of renewables. 

It used to be said that all that was necessary for the triumph of evil is for good men to do nothing.  Now, we can say that all that is necessary for the triumph of evil is for good men to do something, but in the state of Washington.

“While we believe the Ferndale Refinery is a strategic fit for this renewable diesel project, permitting uncertainties were leading to delays and higher costs,” said Robert Herman, Phillips 66 executive vice president of Refining. “Phillips 66 continues to progress its portfolio of renewable diesel projects and evaluate new opportunities to provide consumers with renewable fuels that comply with low-carbon fuel standards.”

“Although we are disappointed in this result, REG is undeterred and continues to develop numerous opportunities to grow our renewable diesel production,” said Cynthia “CJ” Warner, Renewable Energy Group CEO. “We remain dedicated to positively impacting the environment and reducing the carbon intensity of transportation fuels through the application of REG’s proven technologies.”

What REG is loathe to add while farewelling valiant partners and a site they had thought highly of, is that the company frankly has quite a few options, elsewhere. It really is not a question of whether, we believe, in expanding the footprint of their proven renewable diesel technology, it is a question of where, when and with whom.

It’s worth remembering, for one, that REG bought extra land at Geismar some time back, and there are plenty of jurisdictions who might welcome a project that creates renewable fuels and jobs. The world is shifting fast towards biodiesel and renewable diesel, and REG’s balance sheet looks terrific right now.

“We have to stay together”

ADM’s Anthony Reed looked back at 2019 in order to set a goal for 2020  — simply put, to maintain the small refinery waiver coalition’s unity, methods and spirit.

“What’s happened in the past 18 months, we had the bunker mentality, the SREs were hurting everyone. People came together with a singular voice, ethanol and biodiesel are acting together. Today, so many things that bind us together, corn oil, SREs, trade. We have to stay together. When we get fractured we lose policy goals. Administrator Wheeler promised that 15 means 15, the market won’t believe it until it happens. EPA will not follow through unless they are reminded over and over. Fingers crossed, they will follow through on their promise, but everyone has to stay vigilant.”

“The Phase One Agreement (withe China) is huge”

American Soybean Association president Ryan Findlay said that biodiesel and trade are key focal points for soybean growers in 2020.

“That phase one agreement is awesome,” he said. “But we have to hold China accountable. The level of coordination, that is what led to this success. Transparency, coordination, finding new Congressional champions for biodiesel, farmers and agriculture.

Iowa’s Kirk Leeds was positive, but not quite as ebullient. “It’s a step in the right direction. Last week was a big week for President on trade agreements and are close on USMCA and China, a sense that we’re moving forward.

We won’t see much positive until the fall.  I have a slight concern that in the past few weeks we have lost a little energy, passion and focus.  The details on intellectual property, sanitary and phyto-sanitary,, it’s huge. But now we are in an era of managed trade. Open trade and globalization has been good for farmers. We shall see how it works out.”

Next on the Agenda

There was buzz about the US House of Representatives, and the climate bill expected from the House in February, as the US pivots towards pre-election positioning.

Biodiesel’s emissions impact is 100X more affordable than EVs in the 2020s.

Dave Slade, the executive director, Biofuel Technology & Services, at REG addressed the impacts of potential new technologies on emissions, in the 2020s.

“How we usually talk about benefits is carbon intensity, but time matters.”

Slade is referring to potential customers who have indicated that they might switch to electric heavy-duty when they are available in big volumes, “because that’s perfect”.

In emissions, time matters, Slade is right. Specifically, he’s referring to the fact that a ton of CO2 doesn’t disappear when emitted. It causes problems today, and problems tomorrow. Conversely, a reduction today removes a problem tomorrow.

The numbers. In what he referred to as “an extremely conservative comparison”, Slade said that a switch to B20 today and B100 in 2026 would cost a customer about $16000 and generate a 39 percent reduction in emissions by the end of the decade (cumulatively).

A switch to EV heavy-duty in 2026 would cost around $500,000 and reduce emissions by 26 percent over the decade, he said.

“The EV path is comfortably 100X more costly in terms of emissions reduction, than switching to biodiesel. For biodiesel, the cost of GHG reduction in minimal and rate-able and is often zero, and there’s no capex needed in the form of new trucks,” Slade said.

The Bottom Line

Though the crowd might be smaller than the election years of 2016, 2012 or 2008, the industry itself is much larger now. Biodiesel has been the favorite advanced biofuel, worldwide, hands down, as measured by gallons, for a very long time. If its crown is under threat, it would only be from renewable diesel, and that’s part of the NBB world, too. 

The skinny is this: It’s a great time for low carbon fuels, they’ve never been so needed as now. Though, in Digestville, we may wonder from where the feedstock will arrive that brings 15 billion galls of fuel to life, we certainly can see that the technology is more proven than ever, and the demand is growing. Alleluia.

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