"From 2012 to 2020 renewable chemicals markets are expected to double in size to account for 11 to 13 % of the total chemical industry," stated BIO's Brent Erickson.
On Thursday, February 17, 2016, BIO's Executive Vice President of the Industrial and Environmental Section spoke at the 2016 Advanced Bioeconomy Leadership Conference (ABLC) located at the Grand Hyatt in Washington, DC.
In case you were unable to attend this year's Advanced Bioeconomy Leadership Conference (ABLC), below is an overview of Brent Erickson's remarks:
Erickson opened by speaking to the impact that policy uncertainty has had on manufacturing advanced biofuels:
"BIO has estimated that, when EPA allowed instability to creep into the Renewable Fuel Standard (RFS) program, it caused a $13.7 billion shortfall in investment needed to build advanced biofuel capacity."
He continued by arguing that the RFS created momentum for biotech innovations beyond biofuels, including renewable chemicals and synthetic biology...
Erickson stated that "BIO has estimated that over the first 10 years, the Renewable Fuel Standard reduced U.S. transportation-related carbon emissions by 589.33 million metric tons." Unfortunately in its final rule, "EPA chose to ignore this data which is like putting 22.6 million additional cars back on the road."
He argued that RFS was working "to drive the investment necessary to commercialize advanced biofuels." And there were many success stories for companies building first of a kind biorefineries. But in 2013, "just as the first commercial cellulosic biorefineries were under construction or trying to start up, investment fell off a cliff."
Next, Brent Erickson remarks on a recent Nature Biotechnology article by Rob Carlson of Bioeconomy Capital which estimated the economic contribution of the biotech industry to the United States.
Carlson found that the "U.S. industrial biotechnology industry revenues reached $105 billion in 2012":
"If you break down the industry into its three main sectors, industrial biotechnology was second only to the agricultural biotechnology sector in its contribution to the U.S. economy.
"Among the industrial bioproducts: biofuels contributed $9.7 billion; while renewable chemicals contributed $66 billion – six times as much.
"Industrial biotech applications are perhaps the fastest growing segment. This sector is not consistently measured in economic statistics, which should be addressed by the federal government."
In his conclusion, Erickson outlined BIO's policy priorities for 2016:
"We need to get the Renewable Fuel Standard back on track. Our industry is of course going to challenge EPA’s interpretation of the general waiver authority...We know what happens to investment when the policy becomes unstable...
"The renewable chemical sector – after being left out of policy for too many years – was recognized in the 2014 Farm Bill, with renewable chemical biorefineries becoming eligible for the Section 9003 loan guarantee program...
"While there are funds for the Farm Bill energy programs, Congress included several Changes In Mandatory Programs measures – or CHIMPS – to cut back the mandatory spending adopted for the programs in 2014. The 9003 loan guarantee program was especially hard hit...
"We need to ensure that the mandatory spending levels are kept and that USDA works to get loans out to projects in a timely manner. These loan guarantees are crucial to ensuring that debt equity or asset financing is a viable option for building biorefineries in rural communities...
"Additionally, renewable chemicals have yet to be recognized in the federal tax code. Sen. Debbie Stabenow in the Senate and Rep. Bill Pascrell have proposed a production tax credit for the sector. And renewable chemicals – along with biofuels – would be eligible for Sen. Chris Coons’ Master Limited Partnership Act...
"And finally, we need to ensure that Congress and federal agencies do not inadvertently create instability for our industry by creating barriers in TSCA reform legislation, or revision of the coordinated framework for regulating biotechnology, or in long approval times for RFS pathways..."
The BIO World Congress is world's largest industrial biotechnology conference. The 2016 event will be held on April 17-20, 2016 in San Diego!