HB2210
On July 3, 2007, Oregon Governor Ted Kulongoski signed into law House Bill 2210, creating a Renewable Fuels Standard for biodiesel and ethanol. The RFS requires diesel to be B2 once Oregon production from regional feedstocks totals 5 million gallons per year (mgy) and B5 once production reaches 15 mgy. The content requirements do not apply to rail, marine or home heating uses. Further, E10 will be required for gasoline once Oregon ethanol production reaches 40 mgy.

The bill allows non-esterified "renewable diesel" to qualify for RFS compliance if it meets a yet-to-be-established ASTM standard, is approved by the EPA, and meets specifications of the National Conference of Weights and Measures.

HB2210 also creates income tax credit for production or collection of biomass used to produce biofuel, creates income tax credit for consumer use of biofuels for transportation or home heating (up to $200 per year), and modifies energy facility siting requirement exemptions. HB2210 creates a quality assurance program and establishes state production tax credits for such feedstocks as woody biomass, canola, barley, triticale, straw, camelina and flax as well as tax incentives for construction of processing facilities.

For the text version of HB2210 click here.

HB3201
This companion legislation, also seen as HB2211, increases the annual cap on the Business Energy Tax Credit from 35% to 50% for renewable energy systems, expands BETC to include facilities that manufacture or distribute alternative fuels, and modifies the period over which the credit may be claimed.

For the text version of HB3201/HB2211 click here.

BEST
Approximately $2.5 million in funding was approved for the 2007-08 biennium for Oregon Bio-economy and Sustainable Technology Research (BEST) Center, which provides research and testing of commercial applications of various green technologies throughout the Oregon university system, focusing on biofuels and bio-based products.

HB1303
Known as Clean Air/Clean Fuels, this bill directs public fleets to aggressively increase biofuels use, funds much-needed feedstock and market incentive research at Washington State University, and expands agency reporting requirements to support industry development.

For more information about, and access to the text version of, HB1303 click here.

HB1888
Establishes Brassica seed production districts and provides a forum to set rules to protect prime vegetable seed production areas. Growers and seed companies will work with the Department of Agriculture to avoid cross pollination and contamination issues.

For more information about, and access to the text version of, HB1888 click here.

SB5009
Exempts biodiesel fuel from sales and use tax when consumed for nonhighway farm operations.

For more information about, and access to the text version of, SB5509 click here.

SB5669
Expedites permitting by state agencies for storage tanks, blending capacity, rack modifications, and other infrastructure needs in support of RFS implementation, sunsets Jan 1, 2010.

For more information about, and access to the text version of, SB5669 click here.

Federal Renewable Fuel Standard
The Energy Policy Act of 2005 amended the Clean Air Act to establish a Renewable Fuel Standard program. The program will ensure that gasoline sold in the United States contains a minimum volume of renewable fuel. Congress gave EPA the responsibility to coordinate with the Department of Energy, the Department of Agriculture, and stakeholders to design and implement this first-of-its-kind program.

In December 2005, three months after the Energy Policy Act of 2005 was signed, EPA set a statutory default standard requiring 2.78 percent of the gasoline sold or dispensed in calendar year 2006 be renewable fuel. The RFS for 2008 will increase the requirement to 4.66 percent.

The RFS program will increase the volume of renewable fuel required to be blended into gasoline to 7.5 billion gallons by 2012. The RFS program was developed in collaboration with refiners, renewable fuel producers, and many other stakeholders.

A renewable fuel is defined in the Energy Policy Act as a motor vehicle fuel that is produced from plant or animal products or wastes, as opposed to fossil fuel sources. Renewable fuels include ethanol, biodiesel and other motor vehicle fuels made from renewable sources. The program grants credit for both renewable fuels blended into conventional gasoline or diesel and those used in their neat (unblended) form as motor vehicle fuel.

Any party that produces gasoline for use in the U.S., including refiners, importers, and blenders (other than oxygenate blenders), is considered an obligated party under the RFS program. All obligated parties are expected to meet the renewable fuel standard beginning in 2007, with two important exceptions. First, small refiners and small refineries are exempt from meeting the renewable fuel requirements through 2010. Second, all gasoline producers located in Alaska, Hawaii, and noncontiguous U.S. territories are exempt from the RFS program indefinitely. These states and territories may opt into the program and all of the refiners (except for small refiners and refineries), importers, and blenders located there will then be subject to the RFS.

Due to the certainty provided to investors by the RFS program, production capacity for ethanol and other renewable fuels has significantly increased since the Energy Policy Act was signed, and the construction of new and expanded facilities is projected to continue. As a result, nationwide volumes of renewable fuel already greatly exceed the RFS requirements. By 2012, nationwide volumes are projected to reach over 11 billion gallons, compared to the 7.5 billion gallons required.

For more information visit www.epa.gov/otaq/renewablefuels/.

Oregon Renewable Fuel Standard
On July 3, 2007, Oregon Governor Ted Kulongoski signed House Bill 2210, creating an RFS. The RFS requires diesel to be B2 once Oregon production from regional feedstocks totals 5 million gallons per year (mgy) and B5 once production reaches 15 mgy. The content requirements do not apply to rail, marine or home heating uses. Further, E10 will be required for gasoline once Oregon ethanol production reaches 40 mgy.

The bill allows non-esterified "renewable diesel" to qualify for RFS compliance if it meets a yet-to-be-established ASTM standard, is approved by EPA, and meets specifications of the National Conference of Weights and Measures.

Portland Renewable Fuel Standard
On July 12, 2006, the Portland City Council approved an RFS. The requirements of the RFS became effective as of July 1, 2007. The RFS applies to fuel sold inside the Portland City limit for on-road motor vehicles.

As of August 15, 2007 all diesel fuel dispensed within the City of Portland must contain at least 5 percent biodiesel (B5). Beginning July 1, 2010 all diesel fuel dispensed by vendors within the City of Portland must contain at least 10 percent biodiesel (B10). As of November 1, 2007 all gasoline dispensed by fuel vendors must contain at least 10 percent ethanol (E10).

For more information visit www.biofuelsportland.com

Washington Renewable Fuel Standard
Washington's RFS will require that gasoline contain at least 2 percent ethanol and that diesel contain at least 2 percent biodiesel, with graduated increases in these minimums over future years, provided that certain supply and environmental conditions are met.

The initial 2 percent biodiesel content in diesel fuel may increase to 5 percent if there is sufficient in-state biodiesel oilseed production and crushing capability. The ethanol content in gasoline may increase to 10 percent or more if no adverse ozone pollution levels result and sufficient raw materials are available within the state to support economical production of additional ethanol.

The law also addresses biofuel quality. The establishment and enforcement of appropriate biofuel quality standards is essential to the successful implementation of the RFS. Biodiesel performance problems can occur in cold weather or due to moisture and bacterial contamination. Proper fuel production and handling can alleviate those problems. The Washington legislation requires the adoption of rules to maintain biodiesel fuel standards.

Washington is expected to implement the 2 percent minimum renewable fuel content requirement for biodiesel and fuel ethanol on November 30, 2008 and December 1, 2008, respectively.

For more information visit agr.wa.gov/bioenergy and read the Biofuels Advisory Committee Report August 2007.

Alternative Fuel Infrastructure Tax Credit
The Energy Policy Act of 2005 provides a tax credit equal to 30 percent of the cost of alternative refueling property, up to $30,000, for business property. Qualifying alternative fuels are natural gas, propane, hydrogen, E85, or biodiesel mixtures of B20 or more.

Buyers of residential refueling equipment can receive a tax credit for $1,000. For non-tax-paying entities, the credit can be passed back to the equipment seller. The credit is effective on equipment put into service after December 31, 2005. It expires December 31, 2009 (hydrogen property credit expires in 2014).

In May 2006, the Internal Revenue Service published Form 8911, which provides a mechanism to claim the infrastructure tax credit. Owners who install qualified refueling property on multiple sites can utilize the credit for each property. The instructions define what is considered qualified property and the value of the credit. View IRS Form 8911.

Oregon Business Energy Tax Credit (BETC)
Business owners and others who invest in alternative fuel projects in Oregon may be eligible for a state tax credit. Eligible projects include fuel processing and distribution facilities, equipment used for the harvesting and/or preparation of biofuel feedstock, and dispensing and storing of biofuels. Oregon biofuel facilities are eligible for state incentives if the biofuel blend is 20 percent or more. A tax credit recipient must have an Oregon tax liability. The tax credit for renewable projects has been increased from 35 percent to 50 percent of the eligible project costs for projects completed after January 1, 2007. The tax credit is filed over five years: 10 percent for each of the five years. For projects with eligible costs of $20,000 or less, the tax credit may be taken in one year. Unused credits can be carried forward up to eight years. Additionally the BETC has increased the project cap from $10 million to $20 million.

Non-profit organizations, schools and other public entities that do not have an Oregon tax liability and businesses who would rather receive a reduced one time payment may participate in the Business Energy Tax Credit Program by using the Pass-through Option. In exchange for a lump-sum cash payment, project owners may "pass-through" or transfer their 35 or 50 percent tax credit project eligibility to a pass-through partner with an Oregon tax liability. The same review, rules and standards apply to projects approved under the Pass-through Option as those using the regular Business Energy Tax Credit Program.

For more information visit oregon.gov/ENERGY/CONS/BUS/BETC.shtml.

Energy Loan Program
The purpose of the Energy Loan Program (also known as SELP) is to promote energy conservation and renewable energy resource development. The program offers low-interest loans for projects that:

• Save energy
• Produce energy from renewable resources such as water, wind, geothermal, solar, biomass, waste materials or waste heat
• Use recycled materials to create products
• Use alternative fuels

The Energy Loan Program can provide loans for individuals, businesses, schools, cities, counties, special districts, state and federal agencies, public corporations, cooperatives, tribes, and non-profits. Projects must be in Oregon.

For more information visit oregon.gov/ENERGY/LOANS/selphm.shtml.

The Energy Policy Act of 1992 (EPAct) was passed to reduce our nation's reliance on foreign petroleum and improve air quality.

Several parts of EPAct were designed to encourage use of alternative fuels, helping reduce our dependence on imported oil used in the transportation sector. EPAct relies on regulatory approaches for encouraging the fundamental changes necessary to building a self-sustaining alternative fuel market.

EPAct requires certain fleets to purchase a percentage of light-duty alternative fuel vehicles each year. Some types of vehicles are excluded, such as, law enforcement, nonroad, and emergency vehicles.

The U.S. Department of Energy (DOE) manages these acquisition requirements through the Federal Fleet Requirements, State and Alternative Fuel Provider Rule, and the Private and Local Government Fleet Rule.

EPAct also includes the voluntary acquisition of light, medium, and heavy-duty AFVs. This area of EPAct is implemented through DOE's Clean Cities Program, which helps create markets for alternative fuels and AFVs through public/private partnerships in more than 80 U.S. cities.

For more information on EPAct, visit the DOE web site.