Illinois producers 'very supportive' of proposed higher federal requirements for biofuels

[February 11, 2023]  By Zeta Cross | The Center Square contributor

(The Center Square) – The Environmental Protection Agency is looking to expand biofuel volumes. This means an increase in production for producers in Illinois.

The Illinois Renewable Fuels Association supports the proposal to increase the amount of required biofuels that are added to U.S. transportation fuels in the next three years. That includes David Zimmerman, a member of the IRFA and CEO of Big River Resources in Galva.

“We are very supportive of increased [renewable volume options], whether they be for conventional biofuels or biodiesel or renewable diesel biofuels,” he told The Center Square.

Some renewable diesel producers have complained that the EPA did not give full weight to the pace of renewable diesel build up, Zimmerman said.

“That is a concern for some. How quickly and to what degree will the renewable diesel industry expand,” he said.

Zimmerman compares the situation to 2003, when the ethanol industry went through a massive expansion.

“We are seeing a similar situation in renewable diesel capacity at this point in time,” he said.

If renewable diesel producers increase capacity from around 2 billion gallons currently to 5 billion gallons by 2025, as some industry watchers predict, the EPA may have to make adjustments to the Renewable Fuel Standard, Zimmerman said.

The EPA has proposed 20.82 billion gallons of total renewable fuel in 2023, an increase over the 2022 standard of 20.63 billion gallons. In 2024, totals would climb to 21.87 billion gallons. In 2025, the total would rise again to 22.68 billion gallons.

Ethanol is mainly produced from corn. Biodiesel and renewable diesel are produced from vegetable oil feedstock, including waste cooking oil and processed soybean oil.

“The corn ethanol side has a calculated number of 15.25 billion gallons, which is as big as we have seen throughout the history of the program,” Zimmerman said. “That means continued, strong corn demand from the ethanol segment.”

The EPA standard also benefits soybean producers, he said.

“The expansion of the renewable diesel production capacity will certainly put soybean oil and soybeans in higher demand,” Zimmerman said.

In the interest of decarbonization and environmental protection, U.S. oil refiners are required to add billions of gallons of biofuels to petroleum-based fuels.

Biofuels also protect motorists from price hikes in the global oil industry.

“We view liquid fuels as a critical and huge proportion of our future transportation fuels,” Zimmerman said.

The situation in the European Union last year when the war in Ukraine broke out highlighted how critical energy security is, Zimmerman said.

“Reliance on bad actors ... for natural gas has proven to not be in our best interest,” he said.

Biofuels are locally grown. They reduce the U.S. need for Middle East oil, he said.