The Canadian federal government is surging ahead with plans to make 2% biofuel content mandatory in all diesel and heating oil sold in the country from July 1, with some exemptions, Environment Canada announced Wednesday.
With curbing green house gas emissions being the prime driver in issuing the mandate, the announcement said the mandate would bring Canada even closer to its goal of reducing GHG emissions by 17% by 2020, compared to 2005 levels.
"We moved forward with regulations that require all gasoline to have a 5% average renewable fuel content, which came into effect on December 15, 2010," federal Environment Minister, Peter Kent, was quoted as saying in an emailed statement. "Now, we have followed through on our commitment for diesel fuel and heating oil and our two biofuels requirements, combined with those of the provinces, will reduce annual GHG emissions by up to 4 megatons or the equivalent of 1 million cars being taken off the roads."
"These regulations will also generate more than environmental benefits. As an important part of the [federal] governments Renewable Fuels Strategy, they will establish a demand for renewable fuels to help stimulate the Canadian biofuels industry," he said.
The announcement has elicited concerned reactions from the industry, with Stephen Laskowski, senior vice-president for economic and environmental affairs at the Canadian Trucking Alliance, stating that the mandate was issued to "primarily" help the agricultural industry and would result in a hike diesel fuel cost.
"Also, some technical feasibility issues are yet to be addressed," he said in a phone interview. "Ottawa's National Renewable Diesel Demonstration Initiative spoke of the need to resolve issues related to fuel technology, end-user application, infrastructure readiness and market acceptance. There is also is the issue of a shortage in blending capacity, which would imply 85% of the biodiesel would have to be imported," he said.
"Of course, this date is just a few days away, so it's important to note that there will be an 18-month first compliance period in order to provide some flexibility," Kent, the minister, said. "We have listened to stakeholders concerns and incorporated in the final amendment are some flexibilities in the regulations which we feel effectively balance competitiveness impacts on Eastern Canada with the need to minimize delays to support the domestic biodiesel industry in moving forward."
A permanent exemption is being provided for renewable content in diesel fuel and heating distillate oil sold in Newfoundland and Labrador to address the logistical challenges of blending biodiesel, said the Environment Canada announcement, adding that temporary exemptions for renewable content in both diesel fuel and heating distillate oil sold in Quebec and all Atlantic provinces are being provided until December 31, 2012.
"This 18-month period will allow eastern refiners time to install biodiesel blending infrastructure," it said.
