Biodiesel and biofuels report: The EPA is responsible for developing and implementing regulations to ensure that transportation fuel sold in the United States contains a minimum volume of renewable fuel. The Renewable Fuel Standard (RFS) program regulations were developed in collaboration with refiners, renewable fuel producers, and many other stakeholders.

The RFS program was created under the Energy Policy Act (EPAct) of 2005, and established the first renewable fuel volume mandate in the United States. As required under EPAct, the original RFS program (RFS1) required 7.5 billion gallons of renewable- fuel to be blended into gasoline by 2012.

Under the Energy Independence and Security Act (EISA) of 2007, the RFS program was expanded in several key ways:

• EISA expanded the RFS program to include diesel, in addition to gasoline;
• EISA increased the volume of renewable fuel required to be blended into transportation fuel from 9 billion gallons in 2008 to 36 billion gallons by 2022;
• EISA established new categories of renewable fuel, and set separate volume requirements for each one.
• EISA required EPA to apply lifecycle greenhouse gas performance threshold standards to ensure that each category of renewable fuel emits fewer greenhouse gases than the petroleum fuel it replaces.

Global production of biofuels increased 17 percent in 2010 to reach an all-time high of 105 billion liters, up from 90 billion liters in 2009. High oil prices, a global economic rebound, and new laws and mandates in Argentina, Brazil, Canada, China, and the United States, among other countries, are all factors behind the surge in production, according to research conducted by the Worldwatch Institute’s Climate and Energy Program.

The United States and Brazil remain the two largest producers of ethanol. In 2010, the United States generated 49 billion liters, or 57 percent of global output, and Brazil produced 28 billion liters, or 33 percent of the total. Corn is the primary feedstock for U.S. ethanol, and sugarcane is the dominant source of ethanol in Brazil. High oil prices were also a factor in Brazil, where every third car-owner drives a “flex-fuel” vehicle that can run on either fossil or bio-based fuels. Many Brazilian drivers have switched to sugarcane ethanol because it is cheaper than gasoline.

Although the U.S. and Brazil are the world leaders in ethanol, the largest producer of biodiesel is the European Union, which generated 53 percent of all biodiesel in 2010. Biodiesel and biofuels see increases in production worldwide and are advancing alternatives to petroleum.

In Argentina, the biodiesel industry grew not only because of favorable conditions for growing soybeans, but also in response to a new B7 blending mandate, which requires the fuel to be 7 percent biodiesel and 93 percent diesel.

Asia produced 12 percent of the world’s biodiesel in 2010, a 20-percent increase from 2009, mostly using palm oil feedstock in Indonesia and Thailand.

Virtually all of the 1.5 billion liters of Argentina’s biodiesel exports, representing 71 percent of total production, went to Europe.

Biodiesel became the first domestically produced fuel to qualify as an advanced biofuel under the RFS2 because it reduces greenhouse gas emissions by at least 50 percent over petroleum diesel. The RFS2 called for 1.15 billion gallons of biodiesel to be used in the United States by the end of 2010 and ensures the domestic use of at least 1 billion gallons of biodiesel annually beginning in 2012. By 2022, when the RFS2 will be fully implemented, the Environmental Protection Agency expects biofuels production to increase U.S. net farm income by $13 billion, or more than 36 percent.

Source: Environmental Protection Agency