Biodiesel Production: Government Regulations (IL)

Barry Latham, M.A.Ed.Biodiesel Production & Curriculum

Chemistry & Physics InstructorChicago Heights, Illinois

Facility Grants

Renewable Fuels Development Program◦Construction or expansion of biodiesel

production◦New facility must have a production capacity

of at least 30 million gallons per year◦Existing facility must expand its production

capacity by at least 30 million gallons per year◦The total amount of the grant awarded may be

up to 10% of the total construction costs of the facility

Clean School Bus Program

Provides funding to reduce diesel emissions◦Emission control retrofits◦Bus replacements◦Implementation of cleaner fuels,

including biodiesel, propane, and natural gas

◦Support for emissions reduction policies, including those related to idle reduction

Alternative Fuel Vehicle (AFV) and Alternative Fuel Rebates Provides a rebate for:

◦ 80% of the incremental cost of purchasing an AFV (up to $4,000)◦ 80% of the cost of federally certified AFV conversions (up to $4,000)◦ For the incremental cost of purchasing alternative fuels

Eligible fuels for the program include E85, diesel fuel blends containing at least 20% biodiesel (B20), natural gas, propane, electricity, and hydrogen.

The AFV or conversion system must be purchased from an Illinois-based company or vendor, except if the vehicle is a heavy-duty specialty vehicle that is not sold in Illinois.

Only hybrid electric vehicles fueled with alternative fuels are eligible.

The biodiesel fuel rebate (for B20 and higher blends) is for 80% of the incremental cost of the biodiesel fuel, as compared to conventional diesel.

The Program is open to all Illinois residents, businesses, government units (except federal government), and organizations located in Illinois.

Renewable Fuels Research, Development & Demonstration ProgramAdministered by the Illinois

Department of Commerce and Economic Opportunity◦To promote and expand the use of biofuels

such as ethanol and biodiesel as clean, renewable transportation fuels

◦Accelerate the commercialization of new renewable fuel technologies and products

Provides grants of up to $25,000◦Development of business plans◦Engineering & design studies◦Permit applications

Biodiesel Production TaxEffective July 1, 2007

Private biodiesel producer◦Converts any biomass materials into biodiesel

fuel, which is produced exclusively for personal use and not for sale

◦Blends biodiesel fuel resulting in biodiesel blends, which is produced exclusively for personal use and not for sale

◦Production is less than 5,000 gallons per year Subject to the annual state motor fuel tax Due by January 20, of the following year

◦Production is 5,000 gallons or more per year Taxes due on a monthly basis

Biofuels Labeling Requirements

Blends of 5% biodiesel or greater◦Capital letter "B" followed by the numerical value

representing the volume percentage of biodiesel fuel

Between B5 and B20 blends◦ The specific blend must be identified or◦ Phrase such as "biodiesel blend between 5% and

20%" may be used

For blends above B20◦ The specific blend must be identified

Specific label format and size requirements apply

Biofuels Education & Promotion

The Promote Illinois Ethanol and Biodiesel Act◦Requires state agencies, including

state-supported universities and colleges, to provide links from their Web sites to sites containing information on ethanol and biodiesel fuels

◦The links must connect to Web sites maintained and operated by state agencies and may also include links to private Web sites.

State Energy Independence Plan

Replacing 50% of the state's energy supply with homegrown fuels by 2017◦Invest in renewable biofuels by providing

financial incentives to build up to 20 new ethanol plants and five new biodiesel plants

◦Increase the number of gasoline stations that sell biofuels, to ensure that all gasoline stations in the state offer E85 by 2017

◦Help the auto industry increase the number of flexible fuel vehicles they produce and increase public awareness about E85

Biodiesel Blend Use Requirement (>B2)Any diesel powered vehicle owned or

operated by the state, county or local government, school district, community college, public college or university, or mass transit agency◦Required to use B2 where available, unless

the vehicle engine is designed or retrofitted to operate on a higher percentage of biodiesel or on ultra low sulfur diesel fuel

◦Biodiesel is defined as a renewable fuel conforming to ASTM D6751 and registered with the U.S. EPA

State Agency Vehicle Acquisition Priorities and Biofuels UseThe Illinois Department of Central

Management Services (CMS)◦Directed to take all actions necessary to enable the

procurement of B2 for the state's diesel vehicle fleet◦ The CMS is directed to advise the IL DCEO in

developing a plan to facilitate the use of B2 in the state fleet and expand the biodiesel fueling infrastructure

◦Directors of all executive agencies are directed to implement policies and procedures requiring state employees to use E85 and B2 in state vehicles whenever practical

◦State agencies are permitted to establish priorities for the acquisition of diesel vehicles capable of using biodiesel

Advanced Vehicle Acquisition and Biodiesel Fuel Use RequirementAll vehicles purchased from state funds

after July 1, 2007, fuel efficient hybrid electric vehicles (HEVs).◦Fuel efficient HEVs are defined as

automobiles or light trucks that use a diesel engine and an electric motor to provide power and gain at least a 20% increase in combined U.S. EPA city-highway fuel economy over the equivalent conventionally-powered model

◦Any vehicle purchased from state funds that is fueled by diesel fuel must be certified by the manufacturer to run on B5

Biofuels Preference for State Vehicle ProcurementState agencies are permitted to

give preference to a qualified bidder who will fulfill the contract through the use of vehicles powered by biodiesel fuels produced from Illinois soybeans

Alternative Fuel Taxicab Regulation – ChicagoEffective April 1, 2006

Chicago taxi companies with 50 or more vehicles in their fleet must operate at least one alternative fuel taxi

No more than 2% of the taxi fleet's licensed taxicabs may be subject to this requirement.