What’s In Store With The ADF Regulation?


Originally Published in The Jacobsen on June 13, 2016
California Biodiesel Industry Commentary

I‘ve lived in California for close to 40 years. I moved here in 1977 from Illinois where I went to high school in the central part of the state, surrounded by corn and soybean fields, and had been an engineering student at the U of I. I originally settled in Northern California but made many trips to the Los Angeles area where I experienced first hand the tremendous smog that plagued the basin. I remember staying with friends in Glendale who lived just blocks away from the San Gabriel Mountains, but we weren’t able to see those majestic mountains from their home due to the thick smog that blanketed the whole region.

Ten years prior to my move to the Golden State the California Air Resources Board (CARB) was established by that crazy left-wing activist governor Ronald Reagan. CARB’s mandate included attaining and maintaining healthy air quality, protecting the public from exposure to toxic air contaminants and providing innovative approaches for complying with air pollution rules and regulations.

Along with the South Coast Air Quality Management District (AQMD), which was established twenty years earlier in 1947, CARB has actually been quite successful in clearing the air, even though LA and it’s surrounding air basin is still one of the most polluted regions in the country. I now can usually see all the way to Mount Baldy from my home in Santa Monica, a distance of about 50 miles as the crow flies, something that would have rarely been possible when I first moved to California. This is even more of an achievement when you consider the population of the state has almost doubled since 1977.

So what’s my point?
CARB has identified a variety of criteria air pollutants that, among other things, contribute to the formation of low-level ozone, which causes smog, a known health hazard. Among these are particulate matter, hydrocarbons, oxides of nitrogen (NOx), carbon monoxide, sulfur dioxide, volatile organic compounds (VOCs) and other reactive organic gases. So one of the big problems is smog, which is caused by ozone creation. NOx is just one contributor to this, and it turns out that, while testing actually shows that depending on the circumstances, NOx both increases and decreases slightly when biodiesel is combusted in a diesel engine, all the other criteria pollutants are dramatically reduced leading to an actual aggregate decrease in ozone formation.

But unfortunately, California’s Environmental Quality Act (CEQA) law is written such that no new law or regulation can go into effect if there are any negative environmental impacts, and if there are then they must be mitigated. As a result, biodiesel, which at best could actually help reduce smog and at worst would have little to no impact, is penalized because of its “potential” NOx contribution.

The reality is that none of this would have been an issue if not for a lawsuit brought and won by, of all things, an ethanol company seeking to improve it’s own financial position by undermining California’s Low Carbon Fuel Standard (LCFS). It did this by focusing on this perceived NOx violation of CEQA by biodiesel. As a result, CARB was forced to demand a mitigation strategy, which is being aggressively pursued by the biodiesel industry. Of course, that hasn’t stopped the ethanol company, which has brought yet another law suit. And the ridiculous thing is that the regulation is expected to sunset by 2023 when 95% of the diesel fleet has transitioned to New Technology Diesel Engines (NTDEs) as required by law, so this is really a temporary problem! But the lawyers are happy…

This appears to be another unintended consequence of regulation. But don’t get me wrong, I am a huge supporter of CARB and the work they have done – I have personal experience, as does any other Californian of a certain age. I think that California legislators and citizens need to be better educated as to the inflexibility of CEQA law, which is very well intentioned but may need some tweaking, especially in this case.

The encouraging news is that I believe there will be a variety of mitigation strategies available by the end of 2017 which will allow biodiesel to continue to be used in higher blends and will pave the way for a pathway to California going to B20 statewide. I think this will be necessary to help meet the 2020 LCFS target. It will be interesting to see what happens and how it will affect the market.