Renewable fuel body wants quotas doubled

VANCOUVER - Canada’s renewable fuels industry is pressing the federal government to double the percentage of renewable fuels it will require in gasoline and diesel, the head of the industry association said on Tuesday.

The Canadian Renewable Fuels Association wants Ottawa to raise the ethanol-in-gasoline mandate from 5% to 10% and the still-to-be-implemented biodiesel threshold from 2% to 5%, body president Gordon Quaiattini said.

Canada’s 5% ethanol requirement takes effect across Canada on Dec. 15 after the government passed federal renewable fuel regulations into law in September. Several provinces already have ethanol mandates in place.

A start date for the 2% renewable content in diesel has not yet been set but Ottawa has committed to implementing it in 2011, Quaiattini said.

“We are absolutely talking to government about wanting to expand those mandates,” Quaiattini told Reuters in an interview on the day the association released a report on the state of the fledgling industry.

The document comes a day after the U.S. Environmental Protection Agency said ethanol and other renewable fuels must account for at least 8.01% of the motor fuels sold in 2011 at U.S. service stations to comply with a federal mandate.

The Canadian government has been a strong supporter of the domestic biofuel industry as it tries to find new markets for farmers, create jobs and cut greenhouse gas emissions.

It has set aside $1.5 billion over nine years to invest in the sector, which generates about 2 billion litres of biofuel a year. The sector has grown exponentially in Canada in the past five years but still only makes up 2% of biofuels produced worldwide and 4 percent of U.S. output.

Most of the ethanol in Canada is made from corn and is blended across the country by major oil companies, including Suncor Energy Inc SU.TO and Husky Energy Inc HSE.TO. Biodiesel is made from various feedstock including canola, animal fats and waste oils.

EYES APRIL BIODIESEL START DATE

The association is targeting April 1 as the implementation date for the biodiesel mandate even though the government hasn’t revealed a timetable yet.

“We are certainly working with the dates that we have put in our report card and are optimistic that the government is going to move forward with their commitment,” Quaiattini said.

Asked if the recent resignation of Canada’s environment minister might throw a wrench in the timing, Quaiattini said:

“Certainly I think ministers leaving and new ones coming in does have an impact. But again I think this government has shown its leadership on the renewable fuels file since Day 1.”

A permanent appointment has not yet been named to replace Jim Prentice, who unexpectedly quit his cabinet post earlier this month to join a Canadian bank.

Quaiattini declined to speculate on a timetable for the higher renewable fuel standards the industry is asking for but said they should be in place much more quickly than the first batch. The initial mandates involved more than a “decade-worth of discussion”, including four years to put them in place once the government committed to biofuels in 2006.

“We expect to do it at a pace much quicker than the first build-out. We now have the policy and regulatory framework in place. We don’t need to duplicate that going forward,” he said.

source: torontosun