Clean fuels industry leaders voice optimism on prospect for state, federal legislation

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New York's achievement of its statutory climate goals will rely not only on deployment of renewables, but employment of clean and renewable liquid fuels to foster the energy transition, industry leaders argued at a daylong conference in Albany Thursday.

A gathering of industry leaders, academics and policy makers called Pathways to a Clean Future, sponsored by Clean Fuels Alliance America, Wisconsin Soybean Marketing Board, Ohio Soybean Council, and the New York Corn & Soybean Growers Association, focused on clean fuels, such as agriculturally-derived biodiesels, and the role they could play in making immediate changes to reduce carbon emissions in the state's transportation and home heating sectors.

Donnell Rehagen, CEO of Clean Fuels Alliance America, a trade association formed out of a push to find uses for byproducts of agricultural crops like soybean oil in the 1990's, said he's optimistic for the future of the industry and its role in fostering a clean energy transition. "I think our fuels in this conversation are really important at this time," Rehagen told attendees.

Industry sectors that are more difficult to electrify in the short term, like heavy trucking, air travel and marine shipping, could prove to be prime uses for clean fuels like low-carbon biodiesel. Rehagen said the U.S. produced more than 3 billion gallons of biodiesel fuel in 2021, and Clean Fuels Alliance wants to see that figure double by 2030. He believes a combination of federal, state and corporate incentives are key to helping foster the industry.

On the federal level, this includes a $1 per gallon tax credit for purchases of biodiesel and renewable diesel fuels. Corporate policies, particularly in transportation, are encouraging demand and growth in the industry as well. But state policies, Rehagen argues, are leading the transition.

"States are beginning to take that lead and I think that's why we're here today, decarbonizing fuels through some very innovative and very effective programs," Rehagen said. "And you're going to find that there's a very different approach in a lot of states, and we as Clean Fuels Alliance love that, we support that, we want states to look at what will work for them, because what's the benefit of trying to enact a policy, a one-size-fits-all policy maybe that is not going to be embraced and that is actually maybe going to be fought? So, the states are innovating in many ways."

Rehagen points to California’s adoption of a low carbon fuel standard, which incentivizes fuel suppliers to provide renewable and biodiesel fuels, as an example of a driver for the clean fuels industry.

State Sen. Kevin Parker, chairman of the Senate Environmental Conservation Committee, currently sponsors legislation to implement a similar low carbon fuel standard or clean fuel standard in New York. Speaking at the conference, he bucked those critical of the idea that clean fuels could provide more immediate benefits to ease the transition to renewables more broadly.

"By not providing and not allowing a clean energy low fuel standard, they hurt not only our ability to reach our (Climate Leadership and Community Protection Act)  goals, but they also hurt industry, they actually artificially inflate the prices of energy and keep us from the very goals that they believe they're trying to champion," Parker said.

Assembly sponsor of the low carbon fuel standard, Assembly Member Carrie Woerner, also touted the bill’s role in lowering carbon emissions in not only the commercial transportation sector, but at the consumer level as well.

“We have to come up with an alternative that allows us to achieve our greenhouse gas reduction goals in a way that's broader than just using [electric vehicles]," Woerner said at the conference. “So there's an opportunity and you know what the opportunity is. The opportunity is to incorporate alternative fuels into our fuel mix."

Woerner and Parker’s legislation failed to make it out of committee in both houses of the legislature during the 2022 session.