Tag Archives: Renewable Fuels

What is the Future of Fuels?

NACS 2014 Report - The Future of FuelsNACS “Future of Fuels” Report

 

The newly released NACS “Future of Fuels” report offers an analysis  of U.S. government projections through 2040.


NACS
is the Association for Convenience and Fuel Retailing. NACS researches and writes reports for the fuel retailing market. If you’re interested in Liquid Fuels, Renewable Fuels, Non-Liquid Fuels, Natural Gas, Propane, Electricity, Hydrogen, there are details and even future pricing information included in the report.  The “Future of Fuels 2014” seeks to determine how EIA’s projections will directly affect the retail fuels market, consumer use of specific types of light duty vehicles, and the pace at which alternative fuels may gain market share.

A few key highlights are:

  •  Gasoline will remain the dominant fuel powering light duty vehicles through 2040
  • Liquid fuels — gasoline, diesel fuel and E85 — remain the overwhelmingly dominant energy sources for light duty vehicles, contributing more than 99% of total energy consumed by light duty vehicles, and they are projected to remain above 99% market share in 2040
  • In the vehicle market, the share dominated by gasoline-powered vehicles will drop 14% to 79.9%; market share will increase for diesel powered and flexible fuel vehicles (capable of running on gasoline and E85), reaching 4.1% and 10.7%, respectively
  • Current biofuels — ethanol and biodiesel — are forecast to increase from a 2012 supply of 13.58 billion gallons to 15.87 billion gallons in 2040. By 2040, EIA forecasts the availability of 225 million gallons of cellulosic ethanol
  • Non-liquid fuel alternatives — natural gas, propane, electricity and hydrogen — will increase their total contribution to the light duty vehicle energy consumption by 125%, but still only contribute 0.7% of the energy consumed by 2040
  • Electricity is projected to experience the strongest growth in the non-liquid market, increasing its share of non-liquid LDV energy from 2. 5% to 38.5%
  • Hybrid vehicles are forecast to capture the greatest share of the LDV market, growing from 1.1% to 4.4%

If you have questions, contact TAIT. We’ll be happy to provide additional information and to put you in touch with NACS. Going to the PEI/NACS Show? Meet us there! TAIT will have a booth and is scheduling meeting times with our clients and potential clients now.

2014 NACS Show image of 24,000 attendees to network with in the fueling industry

The Fuels Institute, founded by NACS in 2013, is a non-profit research-oriented think tank dedicated to evaluating the market issues related to consumer vehicles and the fuels that power them.Learn more about  The Fuels Institute – Pursuing sustainable transportation energy solutions.

NACS Demystifies the Fueling Experience –  The new 2014 NACS Retail Fuels Report is the largest and most comprehensive ever developed, with more than two dozen backgrounders examining every element of the retail fuels industry.  Learn More

 

EPA Proposes Public Comment Period for RFS – Renewable Fuel Standards

FOR IMMEDIATE RELEASE
November 15, 2013

EPA Proposes 2014 Renewable Fuel Standards

Proposal Seeks Input to Address “E10 Blend Wall,” Reaffirms Commitment to Biofuels

WASHINGTON – The U.S. Environmental Protection Agency (EPA) today proposed for public comment the levels of renewable fuels to be blended into gasoline and diesel as required by Congress under the Energy Independence and Security Act of 2007. Developed with input from the U.S. Department of Energy and U.S. Department of Agriculture, the proposal seeks public input on annual volume requirements for renewable fuels in all motor vehicle gasoline and diesel produced or imported by the United States in 2014. The proposal seeks to put the Renewable Fuel Standard (RFS) program on a steady path forward – ensuring the continued long-term growth of the renewable fuel industry – while seeking input on different approaches to address the “E10 blend wall.”

“Biofuels are a key part of the Obama Administration’s “all of the above” energy strategy, helping to reduce our dependence on foreign oil, cut carbon pollution and create jobs,” said EPA Administrator Gina McCarthy. “We have made great progress in recent years, and EPA continues to support the RFS goal of increasing biofuel production and use. We look forward to working with all stakeholders to develop a final rule that maintains the strength and promise of the RFS program.”

The proposal discusses a variety of approaches for setting the 2014 standards, and includes a number of production and consumption ranges for key categories of biofuel covered by the RFS program. The proposal seeks comment on a range of total renewable fuel volumes for 2014 and proposes a level within that range of 15.21 billion gallons. Specifically, EPA is seeking comment on the following proposed volumes:

Category

Proposed   Volume a

Range

Cellulosic   biofuel

17 mill   gal

8-30   million gallons

Biomass-based   diesel

1.28   bill gal

1.28   billion gallons

Advanced   biofuel

2.20   bill gal

2.0-2.51   billion gallons

Renewable   fuel

15.21   bill gal

15.00-15.52   billion gallons

aAll volumes are   ethanol-equivalent, except for biomass-based diesel which is actual

 

Nearly all gasoline sold in the U.S. is now “E10,” which is fuel with up to 10 percent ethanol. Production of renewable fuels has been growing rapidly in recent years. At the same time, advances in vehicle fuel economy and other economic factors have pushed gasoline consumption far lower than what was expected when Congress passed the Renewable Fuel Standard in 2007. As a result, we are now at the “E10 blend wall,” the point at which the E10 fuel pool is saturated with ethanol. If gasoline demand continues to decline, as currently forecast, continuing growth in the use of ethanol will require greater use of higher ethanol blends such as E15 and E85.

The Obama Administration has taken a number of steps to allow or encourage the use of these higher ethanol blends. In 2010, EPA approved E15 for use in vehicles newer than model year 2001 and developed labeling rules to enable retailers to market E15. In addition, since 2011, USDA has made funding available through the Rural Energy for America Program to support deployment of “flex-fuel” pumps that can dispense a range of ethanol blends. The 2014 proposal seeks input on what additional actions could be taken by government and industry to help overcome current market challenges, and to minimize the need for adjustments in the statutory renewable fuel volume requirements in the future. Looking forward, the proposal clearly indicates that growth in capacity for ethanol consumption would continuously be reflected in the standards set beyond 2014. EPA looks forward to further engagement and additional information from stakeholders as the agency works in consultation with the Departments of Agriculture and Energy toward the development of a final rule.

The renewable fuels program was developed by Congress in an effort to reduce greenhouse gas emissions and expand the nation’s renewable fuels sector while reducing reliance on foreign oil. The standards determine how much renewable fuel a refiner or importer is responsible for, and are the standards designed to achieve the national volumes for each type of renewable fuel.

Today, in a separate action, EPA is also seeking comment on petitions for a waiver of the renewable fuel standards that would apply in 2014. EPA expects that a determination on the substance of the petitions will be issued at the same time that EPA issues a final rule establishing the 2014 RFS.

Once the proposal is published in the Federal Register, it will be open to a 60-day public comment period.

More information on the standards and regulations: http://www.epa.gov/otaq/fuels/renewablefuels/regulations.htm

More information on renewable fuels: http://www.epa.gov/otaq/fuels/renewablefuels/index.htm

 

From the Petroleum Equipment Institute:

The U.S. Environmental Protection Agency (EPA) on November 15 proposed for public comment the 2014 levels of renewable fuels to be blended into gasoline and diesel as required by Congress under the Energy Independence and Security Act of 2007.

The proposal would lower the 2014 renewable biofuel mandate from 18.15 billion gallons to a range of 15 billion to 15.52 billion gallons. EPA’s recommended target of 15.21 billion gallons is within the proposed range. That includes 13.01 billion gallons of corn ethanol and 2.20 billion gallons of biodiesel and advanced biofuels.  The corn ethanol target of 13 billion gallons represents almost exactly 10 percent of the gasoline consumption forecast by the U.S. Energy Information Administration for next year. EPA also proposed changes for cellulosic biofuels, with a range between 8 million and 30 million gallons and a recommended target of 17 million gallons.

The proposed 2014 biofuels blending mandate of 15.21 billion gallons is down from the 16.55 billion gallon target finalized for 2013, and 14 percent lower than the original 2014 goal envisioned by Congress. The Renewable Fuel Standard (RFS) requires annually increasing amounts of biofuels to be added into U.S. transportation fuel supplies, to a total of 36 billion gallons in 2022.

This marks the first time in the history of the RFS that EPA has proposed to scale back the government’s overall biofuel blending target for the forthcoming year. If the proposed targets become law, the biofuels markets will stagnate with no growth expected in the foreseeable future. The bottom line for petroleum marketers is that E10—the blend sold in almost all gasoline stations in the U.S. today—will not be tampered with, but that 15-percent (E15) and 85-percent (E85) ethanol blends primarily will be sold as niche or regional products.

The proposal is subject to a 60-day comment period, and could later be changed.

2013 PEI/NACS Show

2013 PEI/NACS show

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Dennis Tweedy, Billy Watroba and Melanie Nelson attended the NACS show this year, and were joined by a close subcontractor of ours, Katie Seaborn from American Containment Services, Inc.

The 2013 PEI/NACS show, the biggest exposition of fuel handling equipment in the world, lasted from October 12-15 in Atlanta, Georgia. This was the largest NACS show in their history, with 1,050 companies in a attendance making it the 48th largest trade show this year. Over 20,000 people gathered to view and buy the latest advances not only in the convenience store industry, but also in the petroleum business. Every year PEI members convene to discuss, display, and market innovative technologies and services, keeping the industry on the cutting edge. As a bonus, the connections made throughout the convention help to expand and improve businesses, which leads to a greater, more efficient petroleum industry, and where better to have it than in the middle of the #1 buying show in the country. The educational sessions at the NACS show provided extensive information about the highly competitive and illustrious convenience industry. Topics covered in these sessions included:FPImage(10)

  • traditional vs. digital marketing
  • cyberespionage
  • good financing
  • data-driven product positioning
  • the impacts of health care reform
  • customer engagement
  • social media, and much more!

To read more about the topics covered in these sessions visit NACS Educational Sessions, and to learn more about the PEI/NACS Show visit their website. Click here to learn more about the Petroleum Equipment Institute (PEI). For those who are interested, the  following is a video preview of what the PEI/NACS show is all about:

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NYC Biodiesel Regulations Update

NYC Biodiesal Regulations Update

New York City Mayor Michael Bloomberg signed a bill into law last week that requires the city fleet to use a B5 biodiesel blend beginning July 1, 2014. Beginning July 1, 2016, the city fleet must use a B20 blend from April to November. The city will also launch a pilot program prior to December 1, 2016, to study year-round usage of B20 with no fewer than 5 percent of the city fleet.

Wall Street Journal reports:

The measure, introduced by Councilman Jim Gennaro, codifies the city’s existing use of biodiesel blends in the city’s fleet of approximately 6000 vehicles. The city’s Parks and Recreation Department has been using B5 for the last two years and began using B20 this year during warmer months.

The new law requires the city fleet to use a B5 biodiesel blend beginning July 1, 2014. Beginning July 1 2016, the city fleet must use a B20 blend from April to November. The city will also launch a pilot program prior to December 1, 2016 to study year round usage of B20 with no fewer than 5 percent of the city fleet.

Biodiesel magazine wrote:

Home to nearly 8,000 diesel vehicles, the city already uses biodiesel blends in almost all vehicles and in such prominent and key roles as Central Park management, snow removal and garbage collection. The city was an early adopter and is home to many of biodiesel’s biggest champions. A move to B20 would add up to 2 million gallons of biodiesel use annually.

Come see us at PEI/NACS!

TAIT will be in booth #4552

PEI 2014 CONVENTION DATES: OCTOBER 12th – 15th, 2013

 

The Petroleum Marketers Association of America (PMAA) has held its Fall Meeting as part of the NACS Show since in 1995 and the Petroleum Equipment Institute (PEI) has held its annual meeting as part of the NACS Show since in 2002. In 2012, the NACS Show attracted more than 24,000 industry professionals from 65 countries — all seeking or offering the newest innovations, education and conversations about today’s important industry trends and issues.

As convenience and fuel retailing’s premier industry event, the NACS Show offers unmatched opportunities for buyers and sellers to come together, conduct business and learn from one another — all in an environment rich with new ideas and new partnerships.

EPA Finalizes 2013 Renewable Fuel Standards

EPA Finalizes 2013 Renewable Fuel Standards to Help Promote American Energy Independence, Reduce Carbon Pollution

EPA also announces steps to address concerns about the E10 blend wall

As part of an ongoing effort to enhance energy security and reduce carbon pollution, the U.S. Environmental Protection Agency (EPA) today finalized the 2013 percentage standards for four fuel categories that are part of the Renewable Fuel Standard (RFS) program established by Congress. Most of these fuels are produced by American farmers and growers domestically and help reduce the carbon pollution that contributes to climate change.

The final 2013 overall volumes and standards require 16.55 billion gallons of renewable fuels to be blended into the U.S. fuel supply (a 9.74 percent blend). This standard specifically requires:

•           Biomass-based diesel (1.28 billion gallons; 1.13 percent)
•           Advanced biofuels (2.75 billion gallons; 1.62 percent)
•           Cellulosic biofuels (6.00 million gallons; 0.004 percent)

The Renewable Fuels Regulations and Standards can be found on the EPA’s website. You can read the Regulatory Announcement and the Final Rule along with full data online.

These standards reflect EPA’s updated production projections, which are informed by extensive engagement with industry and a thorough assessment of the biofuels market.

During this rulemaking, EPA received comments from a number of stakeholders concerning the “E10 blend wall.” Projected to occur in 2014, the “E10 blend wall” refers to the difficulty in incorporating ethanol into the fuel supply at volumes exceeding those achieved by the sale of nearly all gasoline as E10. Most gasoline sold in the U.S. today is E10. In the rule issued today, EPA is announcing that it will propose to use flexibilities in the RFS statute to reduce both the advanced biofuel and total renewable volumes in the forthcoming 2014 RFS volume requirement proposal.

EPA is also providing greater lead time and flexibility in complying with the 2013 volume requirements by extending the deadline to comply with the 2013 standards by four months, to June 30, 2014.

A January 2013 ruling by the U.S. Court of Appeals required the agency to reevaluate projections for cellulosic biofuel to reflect market conditions; the final 2013 standard for cellulosic biofuel announced today was developed in a manner consistent with the approach outlined in that ruling.

The Energy Independence and Security Act (EISA) established the RFS program and the annual renewable fuel volume targets, which steadily increase to an overall level of 36 billion gallons in 2022. To achieve these volumes, EPA calculates a percentage-based standard for the following year. Based on the standard, each refiner and importer determines the minimum volume of renewable fuel that it must ensure is used in its transportation fuel.

More information on the standards and regulations: http://www.epa.gov/otaq/fuels/renewablefuels/regulations.htm

More information on renewable fuels: http://www.epa.gov/otaq/fuels/renewablefuels/index.htm

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NACS Responds to U.S. House Committee on Blend Wall, RFS

April 10, 2013

The Association for Convenience & Fuel Retailing, NACS sent a response to questions (PDF) from the House Committee on Energy and Commerce white paper on the blend wall and Renewable Fuels Standard (RFS). See our previous blog where the House requested responses.

NACS’ response stated: “In general, NACS believes that the fundamental assumptions that guided Congress’ decision to expand the RFS in 2007 have changed. At that time, most expected the nation’s fuel demand and reliance on imported energy supplies to continue on an unrelenting upward trajectory. Today, these assumptions are no longer accurate — yet the program enacted in 2007 remains unchanged.

“The domestic fuels market is dynamic and conditions are ever changing. As such, it is important any long-term fuels policy be constructed with inherent flexibility to accommodate such changing market conditions. If not, the market is bound to encounter unintended consequences, most of which will be very difficult and potentially expensive to overcome. Ultimately, all expenses incurred by the market will be borne by the consumer. We are beginning to encounter such challenges with the implementation of the RFS and it is appropriate that Congress begin asking questions about the implementation strategy and the effect this program will have on the market.”

The response outlined in detail answers to questions about the effect of the blend wall on gasoline retail prices and the impact of E15. Learn more about NACS interest in and activity on legislation and regulations that affect the production, distribution, price and supply of motor fuels and the c-stores’ specific responsibility to securely store and dispense motor fuels, at the NACS Issues – Government Relations – Motor Fuels page.

“It has been more than five years since the RFS was last revised, and we now have a wealth of actual implementation experience with it,” the white paper explains. “In some respects, the RFS has unfolded as expected, but in others it has not. Several implementation challenges have emerged that received little if any consideration prior to passage of the Energy Independence and Security Act of 2007. Furthermore, the overall energy landscape has changed since 2007. It is time to undertake an assessment of the RFS.”

Following the Renewable Fuels Standard? House Committee Seeks ‘Blend Wall’ Responses by April 5th

House Committee Examines ‘Blend Wall’ Challenges

The House Energy and Commerce Committee released its first in a series of white papers that examines a number of issues emerging with the Renewable Fuels Standard and is asking for input from interested stakeholders.

WASHINGTON – Launching a bipartisan review of the Renewable Fuels Standard (RFS), the House Energy and Commerce Committee released last week its first in a series of white papers that examine a number of issues emerging with the current system and solicit input from interested stakeholders.

Energy and Commerce Committee Chairman Fred Upton (R-MI), Ranking Member Henry A. Waxman (D-CA) and other committee members are leading the effort to review the law and its implementation.

In the 112th Congress, Fred serves as co-chair of the House Energy Action Team, a working group of GOP members focused on communicating positive energy solutions including those encompassed by the American Energy Initiative. He held a similar role in the 111th Congress serving as co-chair of the House Republicans’ American Energy Solutions Group, which focused on lowering energy prices for American families and small businesses through the development of domestic energy sources. Fred strongly supports an “all of the above” approach with a greater emphasis on domestic exploration, the advancement of breakthrough technologies, and the development of nuclear power. Fred has also been a leading opponent of cap-and-trade legislation and needless EPA regulations that stifle growth, destroy jobs, and raise energy costs.

“It has been more than five years since the RFS was last revised, and we now have a wealth of actual implementation experience with it,” the white paper explains. “In some respects, the RFS has unfolded as expected, but in others it has not. Several implementation challenges have emerged that received little if any consideration prior to passage of the Energy Independence and Security Act of 2007. Furthermore, the overall energy landscape has changed since 2007. It is time to undertake an assessment of the RFS.”

The white paper addresses the so-called “blend wall,” the point at which adding the required volume of ethanol to gasoline supplies would result in ethanol blends that exceed 10%, which is the maximum ethanol content approved for sale for use in all vehicles. As gasoline demand has declined in recent years, and ethanol targets have continued to rise, the blend wall is approaching much faster than anticipated. The required volumes of ethanol as set by the RFS must now be added to a smaller-than-expected pool of gasoline, and many experts predict the 10% blend wall may be reached as soon as this year. While blends containing up to 10% ethanol (E-10) have long been used, refiners may need to start producing E15 to stay in compliance. Four subsequent white papers with questions will address other economic, environmental, and policy issues.

The approaching blend wall raises a number of issues for producers, refiners, auto manufacturers, and fuel retailers. The Renewable Standard Assessment White Paper examines these issues and poses a number of questions for discussion. The committee is requesting interested stakeholders to send responses to these questions by April 5, 2013.

Questions for Stakeholder Comment

  1. To what extent was the blend wall anticipated in the debate over the Energy Policy Act of 2005 and the Energy Independence and Security Act of 2007?
  2. What are the benefits and risks of expanded use of E-15 to automakers, other gasoline powered equipment makers, refiners, fuel retailers, and others involved in the manufacture and sale of gasoline and gasoline-using equipment?
  3. What are the risks of the introduction and sale of E-15 to the owners of pre-2001 motor vehicles, boats, motorcycles, and other gasoline-powered equipment not approved to use it? Are there risks to owners of post-2001 vehicles? How do these risks compare to the benefits of the RFS?
  4. What is the likely impact, if any, of the blend wall on retail gasoline prices?
  5. What is the timing of the implementation challenges related to the blend wall? Will some entities face difficulties earlier than others?
  6. Could the blend wall be delayed or prevented with increased use of E-85 in flexible fuel vehicles? What are the impediments to increased E-85 use? Are there policies that can overcome these impediments?
  7. Is E-15 misfueling unavoidable? Are there lessons from the labeling and dispensing of diesel, E-85 and other fuels that prevent their misfueling that can also be applied to E-15? What specific actions are companies taking to address potential misfueling concerns under MMPs?
  8. Can blend wall implementation challenges be avoided without changes to the RFS? Is the existing EPA waiver process sufficient to address any concerns? If the RFS must be changed to avoid the blend wall, what should these changes entail? Should any changes include liability relief or additional consumer protections for addressing misfueling concerns?
  9. Have the 2017 and Later Model Years Light Duty Vehicle Greenhouse Gas Emissions and Corporate Average Fuel Economy standards for cars and light trucks changed the implementation outlook of the RFS?
  10. What other methods, including the use of drop-in fuels, are available to industry to ease the challenge posed by the blend wall?
  11. What are the impacts on renewable fuel producers if the RFS is changed to avoid the blend wall?

Please send responses to rfs@mail.house.gov by April 5, 2013.