Another annual biodiesel conference has come and gone, and it was great to see so many of you in Phoenix.
From the Super Bowl party and the concert afterwards—where musician Emily Richards jammed out on vocals and keyboard, Joe Jobe played harmonica and Manning Feraci finessed the guitar—to the general and breakout sessions, lunch and receptions in the expo hall, offsite dinners and meetings, hallway talk and booth conversation, it was, as usual, a good and productive show. There is no replacement for the one-on-one time that an event like the National Biodiesel Conference & Expo can offer.
Conversations I had with producers and industry stakeholders had some common elements. Despite the National Biodiesel Board being thrilled about the 11th hour retroactive extension of the dollar tax credit, several producers and industry players I spoke with expressed serious concern over the uncertainty in the marketplace it is creating, especially without the assurance of any long-term policy commitment. One producer told me he thought the retroactive reinstatement was like one last chance: “Here you go, enjoy it and use it wisely because it’s not going to happen again,” he said. Maybe that’s true. Many said to me that rather than focusing lobby efforts on a subsidy for which getting any extension longer than a year in this political climate is highly unlikely, the real opportunity lies in expanding the federal biomass-based diesel carve-out well beyond the 1 billion gallon mark by 2012. At the very least, it should be doubled—immediately.
NBB board members discussed the push for 5 percent by 2015. That is certainly an avenue worth pursuing. People were telling me the only ones who profit from the dollar credit are the oil companies required to blend the fuel. And as soon as the credit is in play, feedstock prices track right along with it. But with a healthy mandate in place, and market certainty created by a world without the short-term disruption of the tax credit, RINs would fulfill their intended goal in the market and supplant government subsidies. And moreover, with a robust, court-upheld mandate, who needs a subsidy anyway? The obligated parties have to blend biodiesel and that’s that, irrespective of price.