Definitions (types of fuel, carbon intensity)
Q. What is petroleum diesel?
A: Petroleum diesel is a liquid petroleum product made from decayed plants and animals that lived millions of years ago and is used as a source of energy. Petroleum diesel is suitable for use as a fuel in diesel powered vehicles and equipment.
Q: What is a renewable fuel?
A:Renewable fuels is a general term for fuel products that are produced from non-petroleum sources, like plants and animal byproducts. Renewable fuels can include the following: biodiesel, biomethane, renewable alcohol, clean hydrogen, renewable diesel, renewable gasoline, renewable propane, renewable naphtha, sustainable aviation fuel, and ethanol. Renewable fuels have a lower lifecycle carbon intensity than fossil fuels because they are made from plant and animal material from the current carbon cycle, rather than from fossilized products from millions of years ago.
Q: What is renewable diesel
A: Renewable diesel is a renewable alternative to diesel fuel that is produced through various thermochemical processes, such as hydrotreating, gasification, and pyrolysis. Renewable diesel is chemically the same as petroleum diesel fuel. Renewable diesel meets the American Society for Testing and Materials (ASTM) specification ASTM D975 for petroleum diesel and may be used in existing petroleum pipelines, storage tanks, and diesel engines.
Q: Who manufactures renewable diesel?
A: There are many renewable diesel producers around the world, from companies that focus solely on renewable fuels, to more traditional fossil fuel companies like Shell and BP. Today in the United States, Renewable Diesel is produced in California, North Dakota, Louisiana, Wyoming, and Washington State.
Q: What is biodiesel?
A: Biodiesel is a renewable alternative to diesel fuel that consists of mono-alkyl esters of long chain fatty acids derived from plant or animal matter. Biodiesel is produced through a chemical process called Transesterification and meets the registration requirements for fuels and fuel additives established by the federal Environmental Protection Agency. Biodiesel blends up to 5% biodiesel are covered by the ASTM D975 standard. Biodiesel blends of 6% to 20 % biodiesel are covered by the ASTM D7467 specification.
Q: Who manufactures biodiesel?
A: Biodiesel is produced around the world, including here in Oregon. Sequential Biofuels, now Crimson Renewables, produces the only Oregon fuel product from recycled waste grease.
Q: What is the difference between petroleum diesel, biodiesel and renewable diesel?
A: Petroleum diesel, biodiesel, and renewable diesel are all fuels that can be used in diesel engines, including on road light, medium and heavy-duty vehicles, and off-road equipment like construction equipment and generators, and other industrial processes. All three fuels are interchangeable to a certain degree. Petroleum diesel and renewable diesel fuel meet the same ASTM standards and are essentially the same chemically, even though they come from different sources. Biodiesel is a different product entirely and produced through a different chemical process. Biodiesel can be blended with petroleum diesel or renewable diesel and generally performs the same with in blends under 20% biodiesel.
Q: I’ve never heard of renewable diesel. Where is it used?
A: Renewable diesel is not available today at retail gas stations. All renewable diesel in Oregon is being used by large fleets, like Trimet, Port of Portland, City of Eugene, and the City of Portland. Portland has been using renewable diesel, a blend of 75-99%, since the summer of 2015. The fuel has been used on more than 785 unique vehicles and equipment types in the City’s fleet, including on road vehicles such as light-duty cars and pick-ups, mid-size vans, and medium and heavy-duty dump trucks. It is also being used on off-road construction vehicles, such as excavators and back hoes. Overall, the City’s experience using renewable diesel has been positive. Maintenance costs and downtime for diesel engine repair has gone down and, and because renewable diesel is odorless and does not freeze, maintenance staff report the improved air quality in the shop.
Due to strong clean air and climate laws, the primary market on the West Coast for renewable diesel in 2022 is California and Oregon, but that is changing. The RFS intends to demonstrate demand for renewable diesel in the Portland market, so we can attract more of this fuel. Several new production facilities on the West Coast will come online in the next few years.
Production is also projected to increase nationwide. According to the U.S. Energy Information Administration, as of the end of 2020, U.S. renewable diesel production capacity totaled nearly 0.6 billion gallons per year (gal/y), or 38,000 barrels per day (b/d). Several projects currently under construction could increase this capacity by 2.4 billion gal/y, with proposed and announced projects adding another 1.8 billion gal/y by 2024. If all projects come online as intended, U.S. renewable diesel production would total 5.1 billion gal/y (330,000 b/d) by the end of 2024. However, increased production does not necessarily lead to increased local supply. One goal of the policy update is to build a local market that will incentivize producers to sell in Oregon.
Q: What is ethanol and why is the blend mix staying the same?
A: Ethanol is ethyl alcohol; a flammable liquid used to blend or mix with gasoline. No amendments are proposed to the minimum blend requirement for ethanol because vehicles older than 2001 cannot use ethanol blends higher than the current minimum of 10%. Oregon State law allows blends of up to 15% ethanol in newer cars or 85% ethanol in flex fuel vehicles, so any fuel retailer wishing to offer customers a higher minimum blend of ethanol may do so.
Q: What is the carbon intensity requirement?
A: Carbon intensity is a measure of lifecycle greenhouse gas emissions per unit of energy. The proposed policy uses carbon intensity measurements approved by the Oregon’s Department of Environmental Quality (DEQ) Clean Fuels program, which provide lifecycle carbon emissions for all fuels imported into Oregon. The carbon intensity of different renewable fuels varies significantly.
Lifecycle emissions are emissions produced across a fuel’s full life – including emissions from processing raw materials, production, supply chain transportation, and fuel combustion in vehicles. Lifecycle emission calculations used by Oregon DEQ also factor in changes to land use that can impact climate change.
The proposed policy limits the lifecycle carbon intensity of biodiesel and renewable diesel to 40 gCO2e/MJ, a value that most diesel substitutes in the State Clean Fuels Program currently meet. A CI value of 40 is important because it creates a threshold that excludes feedstocks that are higher carbon across their lifecycle, especially feedstocks from agricultural products like soybeans and canola. Portland also currently requires the same carbon intensity standard for garbage haulers working in Portland.
Q: Who does the existing Renewable Fuel Standard apply to?
A: The existing policy applies to fuel distributors, non-retail dealers, retailers, and wholesale purchaser-consumers of fuel within Portland city limits.
Changes for retailers
Q: How will the proposed policy impact my business operations from a supply perspective?
A: The schedule was designed to minimize supply constraints and give retailers ample opportunity to understand the proposed requirements. The consensus among Oregon-based fuel industry stakeholders is that biodiesel is readily available and competitively priced today. Currently, renewable diesel is not readily available and can be more expensive than fossil and biodiesel in Oregon. The schedule was designed to signal the market that renewable diesel is a desired product, while not overtaxing availability of renewable fuels like biodiesel.
Q: How will the proposed policy impact my business operations from a labeling perspective?
A: The proposed policy will require labeling beyond Federal and State laws for biodiesel blends. BPS will need to develop rules for labeling of renewable diesel, which is currently not covered by state or federal law. Those rules will be developed after City Council adoption of any code amendments through a public rulemaking process.
Q: How will the proposed policy impact my business operation in terms of record keeping?
A: BPS will develop rules for compliance and record keeping in accordance with the code amendments made by Portland City Council. Rulemaking will occur after City Council adoption. Fuel retailers will be required to keep records on site of Product Transfer Documents (PTD). These documents authenticate the transfer of ownership of fuel between parties and must include all information as required under administrative rules developed by BPS and the State of Oregon. A PTD may include bills of lading, invoices, contracts, meter tickets, rail inventory sheets or RFS product transfer documents.
Fuel retailers will also be required to obtain and keep records of Fuel Pathway Codes, the identifier used by the Oregon Department of Environmental Quality in the Oregon Fuels Reporting System that applies to a specific fuel pathway as approved or issued under Oregon Administrative Rules 340-253-0400 through 0470. Fuel Pathway Codes can be obtained from the fuel pathway holder, an entity that has applied for and received a certified fuel pathway code from DEQ, or who has a certified Fuel Pathway Code from the California Air Resources Board that has been approved for use in Oregon by DEQ.
Specifics with how to comply with record keeping requirements will be developed through a public rulemaking process in Fall 2022. BPS will seek guidance from all impacted parties and seek to develop compliance methods that have the least administrative costs for regulated entities.
Price at the pump, availability, engines
Q: How does this amendment affect diesel prices at the pump?
A: The proposed policy would go into effect in 2023, so it will not impact diesel prices before then. The schedule was designed to minimize price impacts. Over the last few years, biodiesel has been less expensive than petroleum diesel, due to the State Clean Fuels program. Based on this trend, the expectation is that, in 2023, the retail price of diesel fuel will not be negatively affected by the proposed policy. Currently in Oregon, renewable diesel is more expensive than fossil and biodiesel. The schedule was designed to allow for planned renewable-diesel refineries in the Pacific Northwest to increase production and supply, helping to reduce prices at the pump. BPS can adjust the minimum blend requirements through interim rule orders due to economic or technical circumstances like lack of supply to avoid price impacts. BPS will work with industry stakeholders to monitor fuel supply and prices as the requirements are phased in.
Q: How was the schedule developed?
A: BPS conducted extensive research on fuel supply with fuel experts and supply-chain stakeholders in the region and around the U.S. This schedule reflects consensus among experts and industry stakeholders that there is ample supply of biodiesel to increase renewable fuel volume requirements immediately, with no negative impacts on retail price. The schedule also reflects fuel-industry supply forecasts for a substantial increase in renewable diesel production both locally and nationally over the next four to six years.
Q: Does the policy address what will happen if prices for biodiesel or renewable diesel increase, or supply of these fuels decrease?
A: Yes. The existing policy gives the Director of BPS the ability to temporarily suspend or modify the minimum blend requirements, if they deem those requirements are infeasible due to economic or technological circumstances.
Q: Does the City control the price of diesel?
A: No.
Q: When I’m at the pump, how will I know how much biodiesel or renewable diesel is blended into my diesel fuel?
A: State and Federal standards already require labeling at the pump, and this requirement will not change as a result of this policy. Similar labeling requirements will be developed through BPS rulemaking for any fuel blends that do not already have labeling requirements.
Q: How does this amendment affect gasoline prices at the pump?
A: The amendment does not change gasoline requirements, so it will not affect gasoline prices.
Q: How will the recommended blends of biodiesel and renewable diesel affect my engine?
A: There will be no impact on diesel vehicle owners. The expert consensus is that biodiesel can be blended into petroleum diesel at blends up to 20% with no negative impacts. Renewable diesel is chemically identical to petroleum diesel and can be used in place of petroleum diesel or biodiesel in blends up to 99%. Renewable diesel users report no negative effects, slightly better performance and longer filter life.
Social and environmental impacts
Q: What are some potential impacts of increasing the volume of renewable fuels sold in Portland?
A: There are positive climate, air quality and economic benefits to increasing the volume of renewable fuels, such as biodiesel and renewable diesel. These two fuels have approximately 60-80% lower carbon emissions on a lifecycle basis than petroleum diesel and emit substantially less particulate matter, a major source of harmful air pollution in Portland. Both fuels can be made regionally, and Oregon is already home to biodiesel manufacturing.
Additional economic and climate benefits are described in the background document found on the project documents page.
Q: Transporting fuel to Portland has impacts on other communities. How does this help/hinder that relationship?
A: Currently, diesel fuel is primarily transported via train, truck, or pipeline to Oregon from California and Washington. The policy will not change this. Both biodiesel and renewable diesel are also imported into the state and the proposed changes might increase the amount. Biodiesel is the only fuel currently produced in the State of Oregon, in Eugene. There is a renewable diesel production facility in the planning stages for development in Clatskanie, Oregon.
Stakeholder engagement
Q: What stakeholders did BPS work with to develop this proposal?
A: BPS has been developing this proposal since 2018. This work required monitoring and tracking statewide legislative efforts, extensive fuels research, and stakeholder engagement. The bureau hired a consultant to lead the research project over the last few years, which included interviews with industry representatives, some of which have been provided anonymously.
BPS also convened the following stakeholders for interviews, workshops, or educational sessions in 2021 and 2022:
- Bretthauer Oil Co.
- BP (British Petroleum)
- Breach Collective
- California Air Resources Board
- City of Eugene
- City of Portland fleets
- City of Vancouver, WA
- Columbia-Willamette Clean Cities
- Columbia Riverkeeper
- Climate Solutions
- Forth
- Green Energy Institute
- Metro
- Neighbors for Clean Air
- NEXT Renewable Fuels
- Oregon Dept of Environmental Quality
- Oregon Dept of Agriculture
- Oregon Environmental Council
- Oregon Dept of Energy
- Oregon Physicians for Social Responsibility
- Port of Portland
- Renewable Energy Group (REG)
- SeQuential Biofuels (now Crimson)
- Star Oil
- Strategies 360
- Titan Freight
- UC Davis
- Unite Oregon
- Verde
- 350PDX