Biodiesel Industry Overview, Advanced Biofuel Initiative, and Sustainability Webinar (Text Version)
This is a text version of the video for the Biodiesel Industry Overview, Advanced Biofuel Initiative, and Sustainability webinar presented on April 27, 2011, by Joe Jobe, Don Scott, and Jessica Robinson, National Biodiesel Board.
COORDINATOR: Welcome and thank you for standing by. At this time, all participants are in a listen-only mode. After the presentation, we will conduct a question-and-answer session. To ask a question, please press star one.
Today's conference is being recorded. If you have any objections, you may disconnect at this time.
Now, I will turn over the meeting to Ms. Sandra Loi. Ms. Loi, you may begin.
SANDRA LOI: Thank you, Kelly. Good morning. Good afternoon, everyone. Thank you for joining us for our monthly Clean Cities educational webinars.
This month, our focus is biodiesel. We will—we have several representatives from the National Biodiesel Board who are here to sort of give you an update on where the industry is today.
The biodiesel industry, as some of you probably know and have read, has experienced some highs and lows in 2010. And, but they are anticipating that 2011 is going to be a better, or maybe even their best, year.
On the line today we have Joe Jobe, Chief Executive Officer of the National Biodiesel Board.
Don Scott, Director of Sustainability. And Jessica Robinson, Director of Communication. Also from the National Biodiesel Board.
In addition, wanted to let everyone know that Jenna Higgins Rose, an Independent Contractor and Senior Communications Advisor to the National Biodiesel Board, is also on the line and will help to field questions.
I'm going to introduce our first speaker, Joe Jobe, who I said is Chief Executive Officer of the National Biodiesel Board. The NBB is the National Trade Association representing the biodiesel industry. It's a coordinating body for biodiesel research and development in the United States.
Joe has been with the NBB since 1997 and has served as CEO since January of 1999. Joe's duties included serving as principal investigator for the $2.2 million biodiesel health effects testing program. And Joe became interested in agricultural, environmental, and energy issues growing up on a farm in central Missouri.
Prior working for the NBB, Joe was a fraud investigator for the Missouri Attorney General's office. And, prior to that, he worked as a certified public accountant.
And now I'm going to pass it to Joe to begin his presentation today. Joe, you may begin.
JOE JOBE: Thank you very much, Sandra. And thank you to all of the participants who have joined in this afternoon. It's great to be invited to your monthly training session.
So hopefully we will, hopefully we'll be able to share some things, and want to leave plenty of time for questions. To be able to hit on any of the major questions that you guys get out in the field in talking to folks.
What I'm going to cover this morning is, I'm going to cover sort of the broad industry overview; what's going on with the markets, the economics, and the government policy drivers. I'll also cover a few things on technical issues, fuel quality, and so forth.
And then we'll have, hopefully, if I don't ramble on too long, we'll have plenty of time for questions. And then Don Scott will talk about some of our sustainability area and issues surrounding sustainability. And Jessica will share with us what some of the tools, and resources, and programs, that are going on for communication and education.
So back to the broad industry overview, as Sandra alluded to. We have had, we've had some pretty interesting times. You know, some pretty dramatic growth leading up to 2008.
And then in 2009, we had the, you know, significant global recession and drop in diesel fuel demand and prices, which pretty significantly hurt demand for biodiesel. And so we've had industry contraction.
And then, in 2010, as Congress was consumed with the healthcare reform debate, they allowed all expiring provisions of the U.S. tax code to expire, and did not get around to extending them until the following December.
So our blender's tax credit, which is the primary economic driver for our industry, was allowed to expire in 2010. So that was led to even further contraction.
So now, this slide kind of shows a number of those, a number of those variables that sort of a confluence of factors. It all hit at once to lead to industry contraction in 2009 and 2010.
In addition to that, we had delays—significant delays in the implementation of the RFS2. And I'll be talking here in a minute about the RFS2 what it is, what it means for the biodiesel industry.
We are very much poised for a resurgence now in 2011. As you probably have heard, the biodiesel tax credit was finally extended through 2011. We're actively seeking a further extension of the biodiesel tax credit, which has been one of the most effective pieces of energy policy that we can point to, ever.
It's led to significant amount of investment in renewable domestic refinery capacity throughout the country, not concentrated in one area like the Gulf of Mexico is for petroleum refinery capacity. But throughout the country, more than 150 biodiesel plants have been constructed in the 5 years that the biodiesel tax credit went into place, and that has created jobs and rural opportunities.
And so we have a very good story to tell. And the tax credit has been very, very, effective.
The RFS2—the renewable fuel standard—now it's fully in place. The EPA has said that it's going to be fully enforced. And RIN markets, RIN stands for Renewable Identification Number, which is generated anytime that a gallon of biodiesel is produced.
And we'll talk about how that works, and how that is impacting markets here in just a minute. And the Bioenergy Program has been established. And that's now in place.
We have a number of state policies that are helping to generate significant demand. We've got strong fuel quality measures in place. We've had significant success in terms of getting vehicle and equipment manufacturer's, original equipment manufacturer's, support and approval for, especially for blends and blends up to B20.
One of the barriers there has been; getting a blends spec. Prior to that, the specification for the ASTM specification for biodiesel was a B100 specification.
And many of the OEMs said, well, they really would like to see a blend specification for blends between B6 and B20. Blends up to B5 are now included in the definition of diesel fuel. It's included in the ASTM specification for B975 diesel fuel. So up to B5 is just diesel fuel. B6 to B20 has its own post-blended specification.
So that's gone a long way in getting more and more vehicle manufacturer's support.
So the conclusion is that this really is one of the best times ever to introduce biodiesel to new users. Working with biodiesel producers and distributors, fleets, and other users, it is a very exciting time to bring on new users when the economics are very favorable for that.
I'm just going to go very briefly through some examples of some of the state policies that are now in place that are helping drive regional demands.
There are now, there are now requirements in four states that have been fully implemented for the low blends of biodiesel where all of the fuel, all of the diesel fuel, in that state contains a low blend of biodiesel—either B2 or B5. Two other states, I'm sorry, four other states have trigger mechanisms that will go into place during, or after, 2011.
There are also a number of states that have the consumption or use incentives. And that's driving significant demand. I'll just give you one example, is the state of Illinois, where there is a sales tax exemption for blends over B10.
So a majority of the fuel today being sold in Illinois is a blend of B11. And that is driving fairly significant demand.
And there are also policies by the states. Carbon policy is actually emanating from the states, rather than the federal government taking a lead on this. The states are actually taking the lead, with California really in a lead role looking at carbon policy, low carbon fuel standards.
You can see the states there. California and Oregon already passing low carbon fuel standards, and other states in the Northwest and New England actively considering similar low carbon fuel standards.
This, as you know, biodiesel has a very significant carbon reduction benefit. And according to the preponderance of studies, biodiesel has about an 80% reduction of carbon compared to petroleum diesel.
So these are policies that hold a significant potential for increasing volumes in those regions.
And then a number of other states have various other policies such as state fleet mandates. And I include these slides so that you can refer to them. And if you want to know more information, you can contact our office about things that are, polices that are in place for your states and your regions. Production is another example.
Now I want to talk about the renewable fuel standard, and how it is affecting markets and how it's, what the program is.
In 2007, Congress enacted the Energy Independence and Security Act. And it requires that a certain amount of renewable fuels be blended into the fuel pool. And it's set goals for increasing those volumes over time, and that includes it caps out at 15 billion gallons of conventional biofuel by 2015, and a total of 22 billion gallons of advanced biofuel by 2022.
And conventional biofuel is defined as essentially corn ethanol. And advanced biofuels are those fuels, that those biofuels that meet a greenhouse gas reduction score of at least 50%—which biodiesel does.
And in 2011, this RFS2 will require 800 million gallons of biomass-based diesel. That's biodiesel's category and that is a significant, that will be a significant increase over last year's, over last year's volume.
So we are expecting, you know, we had approximately 700 million gallons of biodiesel produced in 2008.So we're looking at, you know, somewhere on the order of 800 million gallons in 2011. So we're primed for a significant resurgence.
Now the way the RFS2 works, in terms of requiring obligated parties to blend in, they can actually buy a gallon of biodiesel and receive RIN values for that gallon of biodiesel to comply with their obligations.
Or, they can just simply buy the credits, because a RIN is a credit and you can buy the credit in order to, from others who have generated those RINs, in order to comply with the program.
Now currently, RINs are trading in the range of $1.80 to $2.00 per gallon; that's a wet gallon equivalent. So that's a substantial economic driver and an economic benefit.
And so with the biodiesel tax credit in place; currently that is driving significant demand. And so the economics are favorable currently. That is stimulating investment throughout the country.
It's coming on. It's coming on slower but moving faster and getting more momentum as we move out of winter, move into the warmer seasons, and other markets and applications. So we're seeing a lot of momentum and we're very excited about that.
As I mentioned, an advanced biofuel, as you can see here from the chart, conventional biofuels sort of maxed out in 2015. And the 36 billion gallon target by 2022 will, after 2015, will mostly be met by advanced biofuels.
And so, the biofuels that qualify as an advanced biofuel, or biodiesel, renewable diesel, and cellulosic ethanol.
And so currently biodiesel is the, of those fuels, biodiesel is the only advanced biofuel that meets the criteria of an advanced biofuel because it reduces greenhouse gases by more than 50%; that has reached full commercialization nationwide.
So currently we're, biodiesel is the only, is America's only advanced biofuel. And we believe that it's very well positioned for the future, of the diesel fuel, the diesel fuel pool, and the advanced diesel platform that continues to develop.
You can see here that these are, these dots represent all of the plants that we have— more than 150 plants nationwide that are renewable refineries.
So as you can see, we fully commercialized nationwide and we have taken some very aggressive measures to promote fuel quality. Any new fuel that comes on line, there is, you know, trying to get a fuel into the market, there is lots of things going on, and fuel quality is of the utmost importance. And we have taken very aggressive steps.
We call it the three E's of fuel quality: it's education, encouragement, enforcement. So it's education working with users, working with fuel distributors about proper handling and use guidelines. It's encouragement of BQ9000. BQ9000 is our fuel accreditation program where producers, marketers, and laboratories can go through an accreditation process to be BQ9000 certified.
And approximately 70% of the biodiesel that is in the market right now is coming from BQ9000 companies, and that number is growing. And so as users and distributors, purchasers of biodiesel ask for BQ9000 and we encourage that to happen, and we encourage you to promote that as well to protect consumers. Because when there is bad, when there is off-spec product, or even material that's not even biodiesel, and in fact, if it doesn't meet the specification, it's not biodiesel.
But all biodiesel gets a black eye when there is bad product. So we encourage folks that are out there educating users and distributors and partners about biodiesel, we encourage them to ask for and work with BQ9000 accredited partners.
And then the last one, enforcement. We have been active in all states and the federal government to enforce, to get federal and fuel compliance enforcement agencies such as the IRS, the EPA, the USDA, and others to actively enforce the specification.
And we have, in some cases, advocated for policies in the states to do proactive testing and enforcement of the specification.
Now 48 states have adopted our specification and 18 now do proactive testing. These are the, these are the divisions of weights and measures which are usually reside in the state's department of agriculture.
And so we worked very proactively with that because fuel quality is paramount.
I have a number of slides on OEM acceptance and I'll keep them in there just for your reference. We're not going to cover all of them, just want to, I just want to give a summary here and then open it up for questions.
But now all major U.S. manufacturers support at least B5—that meets the commercial specification. B5 is now included in the definition of diesel fuel. And many, or most, of the OEMs also recommend, in their use guidelines, to deal with the BQ9000 supplier and that's positive.
Over 60% of U.S. OEMs support B20 or higher. And they recommend the blended spec B7467. And more OEMs are continuing testing and progressing to full support of B20.
And if you want to look up an individual OEM position statement, we have them listed on our website in detail. And there is the link there, or you can just go to our website and find it in the fuel fact sheet.
One very positive development this year is that Ford has now fully embraced B20, and they're even, they've even integrated it into their marketing campaign.
You can see their emblem that goes on the side of every 2011 market year and beyond. Diesel pickup has the B20 emblem right on the side. You may have seen some of the commercials, with micro and others with Ford promoting their acceptance of B20.
So it's, that's been a very positive development. And as I mentioned, B20 is acceptable. Accepted and used in the other two. Chrysler and GM accept the use of B20 as well.
So these are lists of some of the manufacturers that support B20, and there are at least two manufacturers, Case IH and New Holland, promote the use of biodiesel up to B100.
So we got really good partners in those two companies. And there are more approvals on the way.
So why don't I just stop there and open it up to questions, Sandra. And hopefully folks have formulated a whole number of questions that we can answer.
SANDRA LOI: Okay, great. Thank you so much, Joe. Kelly, can we go ahead and open up the lines for questions please?
COORDINATOR: Yes, thank you. If you would like to ask a question.
SANDRA LOI: Thank you.
COORDINATOR: You're welcome. If you would like to ask a question, please press star, then one. Please unmute your phone and record your name. Your name is required to introduce the question.
Once again, if you have a question, please press star, then one.
SANDRA LOI: You can also ask questions online. At this time, we have no questions online.
COORDINATOR: And there are no audio questions at this time.
JOE JOBE: Listen, I will go ahead and pass the mic on to Don Scott, our Director of Sustainability.
But I would, you guys are really going to hurt my feelings if you don't send me some questions either online or, you know, I'm glad to hog into Don's, into Don's question-and-answer session if you formulate some questions later and just weren't able to get them sent out.
But yes, please feel free to shoot me any questions and I'll respond to them online as well.
COORDINATOR: I'm sorry. We do have a question now. One moment please.
JOE JOBE: Ah, see, I chatted long enough to stall.
COORDINATOR: Ms. Mr. Garner, your line is open.
CHAPEL GARNER: Hello?
COORDINATOR: Yes, your line is open.
JOE JOBE: You have a question?
CHAPEL GARNER: Yes. This is Chapel Garner from the state department.
JOE JOBE: Yes.
CHAPEL GARNER: Can you hear me okay?
JOE JOBE: Sure can.
CHAPEL GARNER: Okay, good. Joe, we, here in the DC area, you know, the Department of State is one of several federal agencies that uses biodiesel and diesel vehicles here in the DC area.
Problem we have is that our primary source—really our only source—of biodiesel is fixing to go down in October.
And we were hoping to get somebody, you know, get your attention to somehow help us to get another biodiesel source established up here.
JOE JOBE: Yes. So what is the source now? There was the Quarters K.
CHAPEL GARNER: Exactly.
JOB JOBE: From the Pentagon.
CHAPEL GARNER: That's the station. And they are going to close that one permanently in October.
JOE JOBE: They are closing the station?
CHAPEL GARNER: Yes.
JOE JOBE: Okay. Yes. Well, I tell you what we would, we would love to try to work with you to see what we can do to reach out to our partners in the region, to see if we can make some connections.
So if you wouldn't mind sending us an e-mail, just if you send me an e-mail JJobe@biodiesel.org.
CHAPEL GARNER: Okay.
JOE JOBE: And we'll forward that to the right people and see if we can't try to be helpful.
CHAPEL GARNER: Okay. Yes, I think the potential is, you know, there is no doubt that you know, there is a market for it. You know, it's small but, you know, it's something. Okay.
And if we can have it publicly accessible like what we have now with Quarters K, then that opens it up for even, you know, for the commercial also, of course.
JOE JOBE: Absolutely. And I think you know, if we can put together kind of a small, but vocal coalition of government fleets like yourself and others that can ask for that and work with some local partners, hopefully we can get that in place before they close that location.
CHAPEL GARNER: Yes, yes. Well, we do have a secondary source established but it's not publicly accessible. And so that's not as good, you know, as the Quarters K, of course.
JOE JOBE: Absolutely.
CHAPEL GARNER: Well, I will e-mail you Joe.
JOE JOBE: Okay. I'll look for that. Thank you.
CHAPEL GARNER: Thank you very much. Bye.
SANDRA LOI: Kelly, do we have any additional questions on the line?
COORDINATOR: Yes. We have a question from Ms. Hunter.
SANDRA LOI: Great.
HUNTER: Hello? Hello?
JOE JOBE: Hello. Go right ahead.
HUNTER: Hi. I apologize if I missed this. I came in a little late. But I'm wondering if there are any issues with storage? Storing differences between biodiesel and the advanced biodiesel?
JOE JOBE: Yes, you missed that at the beginning of the presentation. I'm sorry, I can't go back to that now. No, I'm just kidding.
HUNTER: All right.
JOE JOBE: No, it's a good question. Storage and really biodiesel—all biodiesel that meets the specification—is an advanced biofuel.
And the reason for that is that an advanced biofuel is defined by the Energy Independence and Security Act of 2007. And under that EPA criteria, of reducing greenhouse gases by more than 50%, all of the biodiesel from all of the domestic feedstocks meet that criteria and are advanced biofuel.
And the storage issues for biodiesel, you know, they, if you're storing, if you're storing B100, that's one thing, if you're storing B20.
When you store a blended B20, you essentially, and that, you know, that meets the specification, it's essentially the same rules that apply with diesel fuel.
We recommend that folks might want to, if they got old tanks, you know, diesel fuel is sometimes found in very dirty conditions. Old, you know. You got water bottoms, you got sludge bottoms.
And, or there are fill lines that are rusted above it because of condensation and things like that. And so a lot of times, just diesel fuel resides in some fairly dirty conditions.
And when there are contaminates, which are dirt, water, and air, then that can cause the fuel to degrade over time.
The same applies to B20. And so when folks are coming into a new situation, we recommend, just because it's good maintenance procedure, to have some tanks cleaned if they' re old and dirty. You know, if they are not old and dirty, then they don't need to do anything. Just dump in B20 on top of the existing conditions.
You know, if it's B100, you know, B100 will gel faster than straight diesel fuel. However, straight diesel fuel in aboveground tanks still needs to, you know, be heated in certain colder regions; the same with B100, just a little bit more so.
Also, with B100, you know, it's going to be stored over a long time, such as in military applications, when you've got equipment that, you know, is going to be sitting for a long time.
We would recommend to spec that out with a stability additive. But again, I'm just saying that is in terms of long-term storage of B100. There are a few additional considerations.
But most biodiesel is not stored long term as B100. Most of it goes in where diesel fuel had been being used and B20 has been used. And those things are not, those special considerations are not as important.
And, in the last few years, we have done a lot with the ASTM specification in terms of adding a cold filtration test and adding stability additives and stability parameters.
So those, you know, again the primary consideration is working with reputable partners that, for example, the BQ9000 certified, and they can offer on-spec fuel. Those are the main considerations. If you focus on that, you are likely to have a positive experience.
Did that answer your question?
HUNTER: Yes. Thank you very much.
JOE JOBE: Thanks.
SANDRA LOI: Great. Thank you, Joe. I think we're going to go ahead and move on to Don. Kelly, can you please go ahead and close the lines again for us?
SANDRA LOI: Okay, great. And so I'm going to go ahead and introduce Don Scott. He is the Director of Sustainability for the National Biodiesel Board.
And he's going to be talking about what makes biodiesel sustainable. Don's program area is both science and awareness to ensure that biodiesel production meets today's needs for environmental stewardship, economic prosperity, and quality of life without compromising future generations' ability to meet these needs for themselves.
Don is a licensed professional engineer with a civil engineering degree from the University of Missouri-Columbia.
Prior to joining the National Biodiesel Board, Don was an environmental engineer for the Missouri Department of Natural Resources. His work there focused on protecting clean, plentiful drinking water. Don, you may begin.
DON SCOTT: Thank you for that introduction. I'm going to build on some of the information that Joe shared. And starting with the definition of advanced biofuels, Joe mentioned that the advanced biofuels must meet the minimum 50% greenhouse gas reduction threshold compared to average petroleum.
In addition, there are specific requirements in federal removable fuel standards that are required of all renewable fuels.
Renewable fuels can only be made from wastes, or recycled products, or agriculture products coming from existing land. No new land can be converted to crop production for the purpose of making renewable fuels.
This requirement ensures that forests or grass lands will not be converted to crop land to meet the renewable fuels target.
Indirect land use changes are also limited by the regulation. EPA has conducted comprehensive lifecycle analysis, including potential emissions from international indirect land use change.
EPA has approved only those feedstocks that maintain a significant greenhouse gas benefit over petroleum, including potential or indirect effects of biofuels.
All these stocks have to be certified to meet these requirements with EPA. For biodiesel, the only foreign feedstocks that have petitioned EPA for approval is canola oil coming in from Canada.
All other imported feedstocks must individually certify that no land use was changed to produce fuel.
So coming up, the feedstocks that EPA has officially approved for biomass-based diesel and advanced biofuel—we have soybean oil, canola, animal fats, recycled grease, waste grease, algae, and inedible corn oil from ethanol plants.
It's also important to mention that we can produce food, feed, and fuel without increasing crop acres. No new acres are needed to meet U.S. goals for biodiesel production.
In fact, there has been no net increase in crop acres in the U.S. since 1959. Through technology improvements, farmers produce more each year on the same or less amount of land.
In the U.S., two acres of farmland are actually lost every minute to development. This is because the price of farm commodities failed to compete with land uses like shopping malls and subdivisions.
In addition to EPA's specific regulatory requirements of advanced biofuel, there are several reasons why biodiesel is advanced. Biodiesel does not compete with food in a negative way. Biodiesel has the best energy balance of any domestic fuel. The terms of demand for the generation implies we are using the most advanced technology possible.
Biodiesel and diesel engines today are cutting edge and have tremendous potential for further refinement. Coming up, all these traits of advanced biofuel; we say that biodiesel is sustainable.
Contrary to the concern that some biofuels compete with food production, biodiesel actually enhances food security. Food production and distribution relies on energy. When energy prices go up, food prices go up.
Alternative forms of energy, particularly renewable energy, that can be used to power tractors, combines, trucks, and barges make our food production system more sustainable.
The United Nations Food and Agriculture Organization recently released a report that concludes producing food and energy side-by-side may offer one of the best formulas for boosting food and energy security—while simultaneously reducing poverty and greenhouse gas impact.
While providing the value for soybean oil, that's a co-product of producing soy protein yield. We helped the farmer be more economically sustainable. Providing additional outlets for surplus oil makes the farmer's business more stable. This makes the food supply more secure for all of us.
While biodiesel is made from a diverse array of feedstocks, including waste, grease, and animal fat, soybean oil constitutes about half of the total U.S. biodiesel production. It's through soybean oil that biodiesel has perhaps the biggest positive impact on food prices.
Soybeans are grown primarily for their high value protein meal as livestock feed. Eighty percent of the soybean is protein meal and about 20% of the beans consist of oil.
Some soybean oil finds its way into our food supply in the form of cooking oil, salad dressing, and that gooey stuff inside Twinkies.
Historically, the oil surplus exceeded demand for food use. The U.S. biodiesel industry uses only a very small portion of the available oil. In total, we use about 1% of the soybean harvest.
By providing a value for the surplus oil, biodiesel can actually reduce the price paid for protein meal. This benefits livestock producers who use protein meal to feed poultry and dairy cows.
An example of how low cost soy protein meal can mean plentiful nutrition for people, it's programs like that of the World Soy Foundation, which provides nutritional rations to people in developing nations.
In 2008, 360 million gallons of biodiesel from soybean coproduced enough soybean meal for the equivalent of 110 billion rations of protein for the hungry.
In 2009, 247 million gallons of biodiesel from soybean coproduced enough meal for the equivalent of 72 billion rations of protein.
There is no doubt that soy continues to provide valuable food and feed, and can also provide fuel without sacrificing human nutrition.
Biodiesel provides a great way to capture and store solar energy in liquid form. For every year that energy put into producing biodiesel, 12 1/2 units of usable energy are generated.
This energy balance was recently updated by USDA. Due to increased efficiency in farming and biodiesel production, this energy balance is predicted to keep rising, reaching nearly 5 1/2 by 2015.
Soybean farming and biodiesel production continue to improve in many ways. In the last decade, soybean yields have risen by 15%. And it's expected to improve at an increasing rate in the near future.
Farmers use 20% less fuel than they did in the 1990s. Soybean and biodiesel processing facilities have reduced energy consumption by 45%, since the industry began in the 1990s.
Biodiesel's positive impact on diesel exhaust emissions remains consistent for all feedstock. Compared to conventional diesel fuel, biodiesel reduces total unburned hydrocarbon by 67%. Biodiesel reduces carbon monoxide by 48%.
Biodiesel reduces particulate matter by 47% and reduces polycyclic aromatic hydrocarbons by as much as 80%. The lifecycle CO2 reduction from biodiesel, compared to petroleum, is as much as 85%.
Any impact that doesn't get much attention, even with major disasters like last summer's gulf oil spill, is the impact that petroleum has on clean water.
Fortunately, and in contrast, biodiesel is non toxic and biodegradable. Biodiesel reduces waste water production by 78% and reduces hazardous waste production by 96%, compared to petroleum diesel.
I'll conclude by sharing these statistics from EPA on the impacts of the federal renewable fuel standard. EPA estimates that, by 2022, when the RFS is fully implemented, requiring specific lines of conventional and advanced biofuel, we will replace 7% of our annual gasoline and petroleum diesel consumption.
We will reduce the outflows of American dollars for imported oil by $41.5 billion. And result in additional energy security benefits of $2.6 billion.
So that was a brief overview of some of the environmental benefits of biodiesel. I'll pause there and try to answer any questions if we have any.
SANDRA LOI: Great. Kelly, can we go ahead and open up the lines for questions please?
COORDINATOR: Yes, thank you. Once again, if you'd like to ask a question, please press star, then one. Please unmute your phone and record your name.
There are no questions at this time.
SANDRA LOI: Okay, great. Well, thank you, Don. And Kelly, please close, go ahead and close the lines again.
COORDINATOR: Okay. Thank you.
SANDRA LOI: Our last, but certainly not least, final speaker is Jessica Robinson. She is the Director of Communications at the National Biodiesel Board. She is going to be introducing the advanced biofuel initiative, which is a communications campaign to educate the public about biodiesel.
Jessica directs an ongoing national media outreach program to increase awareness of biodiesel.
Jessica joined NBB in 2009, bringing to the industry more than a decade of professional communications experience. And her public relations background touches in trade associations, government agencies, and politics.
Jessica has also worked in radio and television news stations in New Mexico, Missouri, and Florida. She is a graduate of the University of Missouri School of Journalism. Jessica, you may begin.
JESSICA ROBINSON: Thanks a lot Sandra. I appreciate that introduction. And thanks everybody for joining us for the webinar today.
I know when we do webinar's you always wonder who is else is out there. There is quite a few folks, and so I just wanted to again say thanks for taking the time to join us.
We've heard already from Joe and Don about the importance of biodiesel being defined as an advanced biofuel.
And so much of this is the conversations that we hear. Maybe not so much as we're talking to our fleet managers and our stakeholders and folks that are in-the-know about biofuels.
But we really start hearing discussions a lot at those cocktail parties, about, you know, conventional and first generation fuels, next generation. All these ideas that the first are conventional and old and outdated, and the next generation, advanced. These are the things that we really want.
And it's important that we all, as stakeholders in the industry and folks who are devoted to clean fuel, understand that advanced biofuel is not just a word that is being thrown around, but it really is a formal, defined term that has been set by the federal government defined by EPA.
And that biodiesel does qualify as an advanced biofuel. So it is really significant that we all keep that in mind. And as Joe mentioned, it's the only one that is commercially available in the United States right now.
You saw this slide already. I point it out because advanced biofuels are where we're going. I mean, Congress recognized this when they passed the RFS. So much so, that also with an advanced biofuel category, are fuels that have not yet been discovered or unveiled, feedstock pathways that have not yet been formally defined.
So this is the open category. This is the, let's go out and find new technologies. Let's go out and advance ourselves and improve our efficiency, improve energy, improve resources.
This is really exciting. And this is where we see the growth for 2022. And, whereas, the conventional biofuels really do cap out there after 2015.
So we have, we're really excited to tell you all about our new program that we're doing here at National Biodiesel Board, and that's the advanced biofuel initiative.
What we want to do is, we want to secure biodiesel's identity as America's first advanced biofuel. We want to help opinion leaders and the public understand that biodiesel is an advanced biofuel, and what that means.
So what you're seeing on the screen here is an example of a print ad that actually ran last fall and gives an idea of the kinds of things that we're looking at going forward.
So, interestingly, this is not going to be without its challenges. These discussions of conventional and first generation being negative, or being undesirable, are not just impressions. They are not just things that we hear and we make assumptions on.
Rather, they are, they have been organized and created by a very unlikely group of opposers.
Folks who have traditionally been across the table at each other in debates are standing side-by-side and holding hands in unison to speak against what they mean as unsustainable biofuels.
And we're seeing groups team up to speak against biofuels. They are using biofuels as excuses for high food prices. Blaming biofuels on all the world's trouble.
And this is really helping to create some of those just real misconceptions about biofuels, that we're going to have to overcome in the future, and that this is effort. This advanced biofuel effort is going to try to correct.
And to give you an example of just how deep that confusion is, and how far those misconceptions go, we have seen comments about the lack of advanced biofuels from the White House. We have seen them from industry leaders and stakeholders. This is an Associated Press article. A quote that we pulled where the writer brought, came to the conclusion that the biofuels industry hasn't been able to create advanced biofuels. When this was actually, the headline was in January of this year.
And so we know that biodiesel sure was around then, and so this is just simply not accurate.
The idea that what we want to accomplish with the advanced biofuel initiative is we really want to ensure that it can be recognized as an advanced biofuel. We want to take that misinformation and turn it around.
When folks hear about biodiesel, we don't want them to think first generation, or conventional. Or that it competes with food and land, or any of these other myths and misconceptions that Don addressed and that just aren't true about biodiesel.
So some of the things that we're working on are this idea of, it's sort of a two-pronged approach. First, the advertising research and online strategies. This is the first time that we have ever taken on a national ad campaign here at the National Biodiesel Board.
So we are going to do a 30-second television spot targeted at the Sunday morning talk shows.
We also will match that with the regional buy-in in the Mid Atlantic area. And what does this mean for the Clean Cities group?
Well, most importantly, this kind of gives a springboard for folks to hopefully ask more questions about biodiesel and to really raise the awareness.
We're looking at late June for the first cycle. And so we're hopeful that gives a timeline and an opportunity to do maybe some promotional items locally for biodiesel, or even just to be aware that these commercials and these discussions are going to be going on on this level.
And then, for the organizational outreach and development, this is really about the one-on-one conversation.
Just like, I'm sure as many of you reach out to folks who are interested and want to learn more about biodiesel, or about other alternative fuels. As we have those one-on-one conversations, we find that once people understand the realities behind biodiesel, and the facts and the data about what it is, and what it does, and what its benefits are, they really start to turn their opinion.
And so the one-on-one, and the organizational outreach is really about having those one-on-one conversations with likely detractors. Because we're trying to stop some of those organizations that routinely speak against biofuels, from speaking against biodiesel.
So we'll do this and we'll also continue our already ongoing communications project and outreach. And so among that are, of course, we do work with the media and we also run the largest information source for biodiesel.
And for Clean Cities coordinators and fleet managers who are interested, we do provide just an array of biodiesel material and handouts and things like that.
This is just a sample of a few of our publications. There is a biodiesel ability brochure, general biodiesel brochures for our general audiences. There is a magazine-type publication called Biodiesel Success Stories that goes over some user success stories as well as quality success stories.
And then, also our Biodiesel Myths Busted. And this really tackles a lot of those myths that we hear so frequently that, again, are inaccurate.
So if you have any questions, I would be happy to take any questions. And I know that Joe or Don would also be happy to answer questions if you thought of things on their presentations.
SANDRA LOI: Great. Thank you so much, Jessica. Kelly, can we open up the lines? Any questions for all of our presenters? If there are any.
COORDINATOR: Yes, thank you. Once again, if you'd like to ask a question, please press star, then one. Please unmute your phone and record your name. One moment. We do have a question.
Bill Ziller, your line is open.
BILL ZILLER: Hello. This is Bill Ziller in San Francisco. I work for the City of San Francisco and we're actively pursuing biodiesel. But we're having some significant problems with underground storage tanks and permitting of those tanks to hold B20.
And I was wondering, has there been other, the same type of issue raised, in other parts of the country and how has that been addressed.
DON SCOTT: This is Don Scott. And yes, interestingly enough, it hasn't been an issue anywhere outside of California. The other states as well as U.S. EPA, you know, they are aware of the issues with underground storage tanks and third-party testing like Underwriter's Laboratory.
It just hasn't been an issue in other parts of the country. You know, since I'm speaking for those agencies. But I think they are fairly comfortable with the fact the biodiesel is nonhazardous and non toxic and biodegradable.
You know, EPA had, or California EPA, had a bad experience with MTBE. Where they had some fuel additives, some petroleum-based fuel additives that contaminated ground water.
So they want to make sure that they don't run into any problems like that in the future, so they're being very conservative. And we've been working with the authorities there to make sure that 5% biodiesel and then up to B20 can eventually be used in underground storage tanks, with all of the proper third-party testing and certification to verify that there aren't going to be any environmental problems there.
BILL ZILLER: Well, we have the B5 exemption already which was very helpful. And I guess as I understand it, and it's the water board who actually controls the underground storage tanks.
They are raising issues that they're trying to get a certification put in place for the biodiesel but apparently Underwriter's Laboratory hasn't been able to do that in, like, the last year or so.
And it's becoming quite problematic. And we could actually use some help here, because I know a number of other municipalities really like to move forward in biodiesel. But the lack of this certification process, that the tanks can hold the biodiesel without leakage issues for the reason you mentioned—the MTBE problem—which was a pretty significant issue here a few years back.
DON SCOTT: Yes, you're absolutely right. You know, well informed on the issue there.
BILL ZILLER: Yes, a little bit.
DON SCOTT: Yes, we've been working with Underwriter's Laboratory and a lot of the professionals in the underground storage tank industry. We made some progress in things like the leak detection equipment, making sure that it's now approved for biodiesel.
And so that's one step in moving towards making the water board comfortable with approving B20 and underground tanks.
We do still have some work to do with Underwriters Laboratory, and part of that is developing the protocol to do the testing. And then to fund the testing, either by the manufacturers or otherwise to test the tanks and prove that there aren't any problems with B20.
From a technical standpoint, we don't expect that those will be any problems there. But like you said, California has some pretty rigid burdens of proof. And so we're working to meet all of those.
BILL ZILLER: Do you have any thoughts on a timeline for that to be accomplished? Pretty general question, I know, but the timeline for that to be accomplished?
DON SCOTT: Yes. And that's, I've lost track of where we are now in that temporary timeline period. I know we did have a temporary period of a year, or two years, to work on those.
And so we're trying to take advantage of that time, you know. We have B5 in those tanks. Trying to make the best of that time to be sure we can get B5 and B20 approved in a long-term-type scenario, without more interruption in supplies than we've seen to date.
You know, if you could send us an e-mail ,we'll get it to, we'll get it to the appropriate person. Shelby Neal works with, who is our State Regulatory Director, and Kyle Anderson is our Technical Manager. And those guys have the latest and greatest.
As you know, you know, too painfully well that's been an ongoing issue. It was my understanding, but I don't want to tell you wrong, I was under the impression that the water board was giving at least temporary waivers on B20. But I don't want to speak out of school.
But if you'll send us an e-mail, we'll get it to Shelby and Kyle, and they will get back with you. If there is ways that we can be helpful, then we certainly will be.
BILL ZILLER: I appreciate that. Who do I send an e-mail to?
DON SCOTT: I tell you what, why don't you just go ahead and send it to Shelby at, it's S-N-E-A-L Shelby Neal, so SNeal@biodiesel.org.
BILL ZILLER: Thank you.
DON SCOTT: Alright. Thanks.
And thanks for, to the City of San Francisco, for your great support of biodiesel B20. It's very much a showcase city for the fuel. Thank you.
BILL ZILLER: Well, you're welcome. And it's our pleasure. We look forward to working with you guys some more later.
SANDRA LOI: Kelly, do we have any other questions?
COORDINATOR: Yes we do.
SANDRA LOI: Thank you.
COORDINATOR: The next question is from, is it Maurie Hunter?
MAURIE HUNTER: It's Maurie. And it was just answered by Bill Ziller's question. So thank you.
COORDINATOR: Next question. Is from, is it Chapel Garner?
CHAPEL GARNER: Yes, that's correct. Could you all send me the slides that you use for this presentation? Could you e-mail them to me?
WOMAN: Sandra, are you sending the slides to all of the registered participants?
SANDRA LOI: Actually, they're going to be posted up on the Clean Cities website. So you can access them from there.
CHAPEL GARNER: Good.
SANDRA LOI: Or you can send me an e-mail directly and I'm happy to send them quicker if you need them. But we will be posting them at Cleancities.energy.gov.
CHAPEL GARNER: Excellent.
SANDRA LOI: Great.
CHAPEL GARNER: That'll do.
SANDRA LOI: Okay.
CHAPEL GARNER: Thank you.
SANDRA LOI: You're welcome.
CHAPEL GARNER: Bye.
WOMAN: Next question is from Bart Miskey.
BART MISKEY: Yes. Bart Miskey. Clean Cities, middle Tennessee out in Nashville. I know, in the past, Sir Richard out there in England was using biodiesel for the airline industry out there.
And wanted to get up to date as to what's going on. I'm doing a lot of work over at the airport—Nashville airport here—Nashville Airport authority. And didn't know what was going on in that venue.
I also heard a year or two ago they were supposed to put up some sort of biomass, or biofuel, biodiesel plant near Nashville that was supposedly supposed to go into the Nashville airport. If you could chime in on that please.
JOE JOBE: Yes. This is Joe, and I'll let Jessica and Don and others chime in as well. But the Virgin Airlines experiments. And there was some other airline experiments, were actually not on biodiesel, they were on some other experimental biofuel technologies, particularly some hydro-treated vegetable oil, some hydrogenated hydro-treated vegetable oil. That is, kind of in that renewable diesel category of experimental fuel.
And you know, that was my best information about what they were doing with actual aircraft.
However, there is biodiesel that is used in the ground support equipment at a number of major airports throughout the country.
One that's been using it the longest, for over 10 years, I know is the St. Louis Airport, the Lambert Airport. They use it in their snow plows and their fire trucks and their ambulances. All their emergency equipment as well as, you know, the some of the other interior ground support equipment.
But a number of other airports have used it in their diesel equipment as well. Did you guys have anything further? Or did that answer your question? Or...
BART MISKEY: Yes. The only thing I could comment is the, I've worked with green fuels out of Reno and they did run a fighter jet back oh, it must be four or five years ago, on biodiesel. And they had good results out there. But that was just one test that I'm aware of.
That's why I was interested in the airport here. To see, you know, if there is anything. I didn't realize they had a special, you know, chemistry for the biofuel, biomass, whatever they are using for airline.
JOE JOBE: Right.
BART MISKEY: But I appreciate your input on that.
JOE JOBE: Yes. I mean, there have been tests done with biodiesel in aircraft. You know, it's been successfully tested. You know, the biggest issue there is the cold flow. You know, when you're at altitude gets really cold up there, regardless of the time of year and other things.
And so, because of that, the FAA currently has an approved biodiesel in any specific form or even waiver form other than in the experiments for use in aircraft.
JESSICA ROBINSON: I think another part of, this is Jessica, I think another part of your question was about a possible producer or a fuel location there in your area. I don't know the story of that particular location but would encourage you and others to visit our website Biodiesel.org.
We do have maps of both production locations as well as retail fielding sites. And those can be searched by route, or by zip code, or by state. And so we've really done some work to those resources in the last 12 months that have made them quite a bit more robust.
And so I would encourage you to take a look at those if you have questions about a specific fielding site to production location.
COORDINATOR: We have no further questions in queue.
SANDRA LOI: Great. Jenna, do you have on the Web that you'd like to...
JENNA HIGGINS ROSE: Yes. There is one question from Lee Grant. From whether there will be updated fact sheets that breakdown why food prices, it's updated fact sheets on the food prices and how biofuels fit into that.
MAN: You know we've been watching that phenomenon since 2008. How food prices are linked to energy prices and the acquisitions that the biofuels contribute to that.
So, you know, we continue to see that the biofuels, and particularly biodiesel ,you know, doesn't have a significant negative impact on food prices.
So we continue to watch that. We continue to watch how food prices are correlated with energy prices, and particularly fossil energy and petroleum.
And so yes, much of that information as we can put together and put into graphs and fact sheets on our website. I think we're going to try and keep up with that.
JENNA HIGGINS ROSE: And also, Lee, and everyone else listening, we will continue to submit updated talking points and facts sheets to Clean Cities so that they can be made available to you all as well.
SANDRA LOI: Great. Are there any additional questions either on the phone or on the Web?
COORDINATOR: Press star one at this time.
JENNA HIGGINS ROSE: We have no more questions online.
SANDRA LOI: Okay. Well, I just wanted to thank everyone. Thank you for joining us. Thank you to our presenters for your time today, and thank you, everyone, who joined us.
As I mentioned, we will be posting slides and also a recording of the webinar Cleancities.energy.gov. And you can find more information about Clean Cities as well.
And if you need any other information you can contact myself, Sandra.Loi@NREL.gov. Or any of the folks at NBB, via the e-mails provided, or at their website at NBB.org.
Thank you so much and have a great rest of the week.
COORDINATOR: This concludes today's conference. Thank you for participating.