With farmers under mounting financial pressure as commodity prices for corn and soybeans continue to slide and costs for fertilizer and other inputs continue to rise, there could be a new market opportunity to open up to $200 billion in new farm revenue by 2050, according to an analysis and subsequent report released by alternative energy and conservation company Roeslein & Associates’ renewables division.
The company pointed to a potential breakthrough that may come this month when the International Maritime Organization (IMO) is expected to finalize its Net-Zero Framework, requiring large ocean-going vessels to cut greenhouse gas emissions beginning in 2027.
“This policy will accelerate demand for biofuels; renewable fuels made from plant material, animal waste, and agricultural residues,” the company wrote, adding that by 2030, biofuel demand for maritime use could grow by up to 25 million metric tons — one-third of global demand.
According to Roeslein & Associates, the most promising fuels are:
Bio Liquefied Natural Gas (BioLNG): Produced from manure, crop residues, and food waste, BioLNG is compatible with existing liquified natural gas (LNG) infrastructure and can achieve a net-negative lifecycle emissions score. With over 1 billion tons of agricultural waste generated annually, the U.S. is uniquely positioned to lead in BioLNG production. With continued global demand for quality protein, it is expected that livestock production waste will increase over the next three to four decades, providing additional feedstock for BioLNG.
Biodiesel & Renewable Diesel: Derived from animal fats, oilseeds, and used cooking oil, biodiesel and renewable diesel offer a drop-in replacement for marine diesel with little or no need for retrofits. The increased demand could equal twice Iowa’s annual soybean crop, generating new markets for farmers across multiple feedstocks. And as farmers continue to innovate and produce more bushels per acre on fewer acres of land and with fewer inputs per acre, the sustainability of feedstocks only continues to improve year over year.
“Biofuels represent more than just cleaner energy. They represent a lifeline for U.S. farmers,” said Ben Kruger, senior vice president of Roeslein Renewables, “By leveraging our agricultural waste and renewable resources, we can stabilize rural communities while helping the shipping industry decarbonize.”
Advanced biofuel producers and industry trade associations, including MiABC stakeholder Clean Fuels Alliance America, are calling for coordination between the United States’ Department of Agriculture, Department of Energy, Environmental Protection Agency, and Treasury for programs to support renewable maritime fuels, as well as fast-tracking renewable fuel production and blending infrastructure; streamlining permitting and credit verification for small and mid-sized farms; and establishing maritime fuel corridors linking inland feedstock to coastal ports.
“The IMO will reward early movers,” said Bryan Sievers, director of government relations.
“The U.S. must act now to ensure farmers are not left behind. As the world’s ships sail toward net-zero, it’s time for American agriculture to chart its own course; powered by innovation, infrastructure, and resources we can no longer afford to waste.”
In addition to efforts by IMO, the Renewable Fuel for Ocean-Going Vessels Act, introduced by Senators Ricketts (R-Nebraska) and Klobuchar (D-Minnesota), would allow companies to preserve Renewable Identification Number (RIN) credits under the national Renewable Fuel Standard (RFS) program.
The RFS excludes “fuel used in ocean-going vessels” from the definition of transportation fuels and from refiners’ and blenders’ obligations. Refiners and blenders are currently required to retire RINs from any biodiesel and renewable diesel used in vessels with Class 3 engines operating in international waters, including the Great Lakes. In the first ten months of 2023, more than 5 million D4 RINs had to be retired under the existing rule.
The U.S. Environmental Protection Agency, however, allows companies to generate and use RINs for “additional renewable fuel,” which includes heating oil and jet fuel. The Renewable Fuel for Ocean-Going Vessels Act would expand the RFS definition of additional renewable fuel and allow companies to use or sell the RINs associated with biodiesel and renewable diesel used in ocean-going vessels.
“Global shipping companies are looking to U.S. farmers and fuel producers to take the lead in providing clean fuels,” said Kurt Kovarik, vice president of federal affairs for Clean Fuels Alliance America. “This commonsense legislation will remove a regulatory roadblock and enable U.S. biodiesel and renewable diesel producers in partnership with soy and canola growers to meet the needs of shipping companies at a competitive price. It will allow refiners and blenders to keep RFS credits for fuel used in ocean-going vessels that are currently being sacrificed.”
Adapted from a post originally shared by Michigan Farm News and a press release offered by Senator Pete Ricketts. Photo credit: Pixabay – idendoktoor
Notice: The Michigan Advanced Biofuels Coalition (MiABC) does not lobby or influence policy in any way. The policy interests of Michigan soybean farmers and biodiesel producers are supported by the Michigan Soybean Association and Clean Fuels Alliance America, respectively. This post is shared for educational purposes only.