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Agriculture

Project Liberty shuts cellulosic biofuel production, citing US EPA policies

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Project Liberty shuts cellulosic biofuel production, citing US EPA policies

Highlights

DSM North America president says US policy favors 'oil over agriculture'

Company blasts US EPA for creating challenging market conditions

Iowa plant shifts focus to licensing opportunities in other countries

Washington — Project Liberty, one of only a handful of US cellulosic biofuel plants, has shut production and shifted focus to research and development in response to market challenges brought on by the US Environmental Protection Agency's implementation of the federal biofuel mandate, POET-DSM Advanced Biofuels said Tuesday.

A spokeswoman declined to give recent production volumes at the Emmetsburg, Iowa, plant.

Through September, liquid cellulosic ethanol has generated only 9 million D3 RINs in 2019, compared with nearly 268.5 million D3 RINs from different forms of renewable gas, according to EPA RIN generation data.

The company, a joint venture of POET and DSM, praised US President Donald Trump's support for biofuel policies, including year-round E15 and recent efforts around the Renewable Fuel Standard. But it took issue with how EPA has carried out those policies.

"Over the last three years, EPA management of the RFS has held back cellulosic ethanol advancement, hindered future agricultural markets for US farmers, and undermined what the president has promised," POET's senior vice president communications, Kyle Gilley, said.

The statement cited EPA's actions on lowering blending requirements for cellulosic biofuels; granting small-refinery waivers that have caused prices of D3 RINs to plunge, which has weakened the incentive for buying cellulosic biofuel and advancing the technology; and blocking new cellulosic pathways.

"Because of these policy changes, the economic landscape for cellulosic ethanol in the US makes private and global investments in this technology more challenging," President of DSM North America Hugh Welsh said. "As a result, our joint venture is responding by temporarily pivoting and focusing on R&D efforts to improve technological efficiencies and explore additional international licensing opportunities in countries that are not choosing oil over agriculture."

The research program will not buy additional biomass but will use feedstock stored on site or already under contract, the company said.

"The joint venture will focus on R&D with the goal of improving mechanical reliability, creating additional technological efficiencies and licensing technology in countries which favorably support the use of low carbon fuels from crop residue and other biomass," it said.

-- Meghan Gordon, meghan.gordon@spglobal.com

-- Josh Pedrick, joshua.pedrick@spglobal.com

-- Edited by Jonathan Dart, newsdesk@spglobal.com

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