The American Soybean Association (ASA) today applauds release of the Environmental Protection Agency’s (EPA) Final Rule for the Renewable Fuel Standard Program (RFS2) that provides a positive outcome for biodiesel and soy biodiesel. ASA has worked hard to educate EPA and policymakers to correct flaws in the original RFS2 Proposed Rule issued in 2009. Achieving a favorable outcome was vitally important as demand for domestically produced soybean oil and the future of the biodiesel industry in the U.S. hinged on the outcome.

EPA’s Final Rule demonstrates that soy biodiesel can achieve significant greenhouse gas (GHG) emissions relative to petroleum diesel. Even with the inclusion of questionable indirect land use variables, all soy biodiesel is deemed by EPA to exceed the 50% reduction threshold needed to qualify for the RFS2 biodiesel mandate.

"This favorable EPA ruling is absolutely critical to the continued success of soybeans as a homegrown renewable fuelstock," says ASA President Rob Joslin, a soybean producer from Sidney, OH. "ASA and the biodiesel industry were able to demonstrate that some of EPA’s initial calculations regarding direct and indirect emissions were significantly flawed, and that the agency had used questionable indirect land use assumptions."

RFS2 has been a top priority for ASA. The initial rule proposed by EPA would have done unnecessary harm to the competitive position of the U.S. soy biodiesel industry. ASA generated significant grassroots support and provided extensive information during the EPA’s comment period on RFS2, resulting in thousands of comments from soybean producers and industry supporters being submitted to EPA.

EPA will require the combined 2009 and 2010 volume levels to be met, which will require the utilization of 1.1 billion gallons of biodiesel by the end of 2010, significantly energizing demand for U.S. biodiesel producers.

ASA is also pleased that agricultural feedstocks produced in the U.S. will be in compliance and no additional certification will be required unless the baseline level of approved agricultural land is exceeded. EPA will require certification for foreign feedstocks.

"ASA fought against the burdensome and unnecessary requirement that renewable fuel manufactures prove that their feedstocks meet the definition of renewable biomass," Joslin says.

"Biodiesel is the cleanest burning biofuel currently used in commercial markets," Joslin says. "Biodiesel is a renewable and sustainable energy source that can play a significant role in our national efforts to increase our energy security and improve our environmental footprint. Biodiesel has also provided a significant market opportunity for U.S. soybean farmers and jobs and economic development for rural communities."

While stressing the importance of the EPA’s RFS2 final rule to the biodiesel and soy industries, Joslin emphasizes that biodiesel production likely won’t resume until Congress extends the biodiesel tax incentive.

"The biodiesel tax incentive expired on Dec. 31, 2009," Joslin says. "Expiration of the tax incentive has essentially caused the production and use of biodiesel in the U.S. to cease and has placed the 23,000 jobs that are currently supported by the domestic biodiesel industry in immediate jeopardy. Companies have already started laying-off employees, and this situation is certain to worsen the longer the tax incentive is allowed to lapse."