Study suggests biodiesel industry supports nearly 48,000 jobs

Nearly 100 biodiesel industry leaders converged on Capitol Hill recently to call for strong clean-fuels policy as a new study found that the industry is supporting nearly 48,000 jobs nationwide. The study, conducted by LMC International, found the 2.1 billion gallons of biodiesel and renewable diesel used by Americans last year supported $8.4 billion in economic impact across a wide variety of economic sectors along with 47,400 jobs and $1.9 billion in wages paid.

The report also highlighted how growing biodiesel imports are eating into the domestic industry’s production and economic impact. It found that the industry would have supported 21,200 additional jobs last year if all the biodiesel and renewable diesel had been produced domestically.

Instead, one-third came from overseas.

Anne Steckel, vice president of federal affairs for the National Biodiesel Board, said the study underscores the benefits of strong policy that encourages further development of the domestic industry.

“Ending our dependence on oil is an opportunity, not just for the environment and our national security, but also for the economy and for American workers,” Steckel said. “This industry is supporting tens of thousands of jobs from coast to coast, and we’re just getting started.”

Biodiesel – made from a diverse mix of resources such as recycled cooking oil, soybean oil and animal fats – is the first and only EPA-designated Advanced Biofuel to reach commercial-scale production nationwide. It's produced at many locations in the Midwest, including the REG plant in Newton.

According to the EPA, biodiesel reduces greenhouse gas emissions by 57 percent to 86 percent compared with petroleum diesel.

Biodiesel producers, feedstock suppliers and other stakeholders headed to Capitol Hill recently to highlight the benefits of strong biodiesel policy.

They are calling for higher Biomass-Based Diesel and Advanced Biofuel requirements under the Renewable Fuel Standard (RFS) than EPA recently proposed along with extension and reform of the biodiesel tax incentive slated to expire at the end of the year. The reform would change the $1-per-gallon incentive to a domestic producer’s tax credit. Under the current blender’s credit, biodiesel imported to the U.S. qualifies for the incentive.

Iowa Gov. Terry Branstad came to REG's Newton facility in May sign a law extending state tax credits for biodiesel.

The LMC study, which was commissioned by NBB, found that biodiesel production has a significant positive impact across a variety of economic sectors, including processing and manufacturing, agriculture, transportation, and animal processing.

Several companies, such as REG, and trade associations have encouraged the EPA to set higher volume targets for biomass-based diesel under the RFS, calling for at least a 2.5-billion-gallon requirement in 2018.

Not everyone is on board with biofuels. A recent European Commission report argued indirect land use changes tied to biofuels caused higher emissions, and that activities like clearing grassland and forests could negate any cuts in greenhouse gases. The EU responded by setting a 7 percent cap on conventional biofuels last year, and encourages countries to promote advanced biofuels by setting national targets.

However, job growth is a major component of growing the biodiesel industry in the U.S., according to the LMC study. LMC found, with 2.5 billion gallons of production, the industry would support 81,600 jobs and $14.7 billion in total economic impact if all production were domestic. The impact is 55,000 jobs and $9.8 billion in total impact under a split of two-thirds domestic production and one-third imports.

NBB is the U.S. trade association representing the biodiesel and renewable diesel industries, including producers, feedstock suppliers, and fuel distributors.

Contact Jason W. Brooks at 641-792-3121 ext. 6532 or jbrooks@newtondailynews.com