Policy uncertainty in the U.S. has disrupted the biodiesel industry, causing the market to shrink in 2014, according to industry group the National Biodiesel Board.
According to government data, total U.S. biodiesel consumption fell to 1.75 billion gallons for the year, down slightly from nearly 1.8 billion gallons in 2013. The downturn came as the Obama Administration failed to finalize biodiesel volumes under the Renewable Fuel Standard and Congress allowed the biodiesel tax incentive to lapse at the beginning of 2014, the NBB said.
“These numbers reflect the consequences of policy inaction,” said Joe Jobe, CEO of the NBB. “The drop in production represents lost jobs and economic activity. It represents a lost opportunity to reduce greenhouse gas emissions and other pollutants. And it represents another year in which we fail to tackle our dangerous dependence on oil in the fuels sector.”
“The numbers would have been even lower had the environmental Protection Agency (EPA) not signaled throughout the year that it will strengthen the RFS proposal and finalize it promptly,” Jobe said. “But companies can operate on faith for only so long. We have already seen many producers close their doors, and many others are struggling to stay open as we enter a New Year with continued uncertainty.”
“The most frustrating aspect is that this is completely unnecessary,” Jobe added. “This is an industry that should be growing, and that has proven it can expand with smart policies in place. Yet we have this paralysis in Washington. Biodiesel companies simply can’t plan for growth or hire new people with the kind of uncertainty we have now.”
Biodiesel – made from a variety of resources including recycled cooking oil, plant oils such as soybean oil, and animal fats – is the first EPA-designated Advanced Biofuel to reach commercial-scale production nationwide. According to the EPA, biodiesel reduces greenhouse gas emissions by 57 percent to 86 percent compared with petroleum diesel. With plants in nearly every state in the country, the industry supports some 60,000 jobs.
The EPA figures reflect U.S. consumption of biomass-based diesel, the vast majority of which is produced domestically.