Canada still waiting on biodiesel mandate

(Commodity News Service Canada) — Canola growers and potential biodiesel producers in Western Canada are still waiting on an official start date for the country’s federal two per cent biodiesel mandate, as the comparable five per cent mandate for renewable fuel in Canada’s gasoline supply is set to go into effect Dec. 15.

Gordon Quaiattini, president of the Canadian Renewable Fuels Association, said a firm date on when the biodiesel mandate will go into effect would help provide the certainty for the biodiesel production projects currently in the planning stages to move forward.

Canola producers in Western Canada recently started a letter-writing campaign to their members of Parliament in an effort to push the government forward.

The growers would like to see a biodiesel mandate in place, as it is expected to “create reliable and consistent demand for about one million tonnes of Canadian-grown canola,” according to a letter to members from the Alberta Canola Producers Commission.

“What farmers are saying, and certainly what we’re saying, is ‘Let’s get on with it,'” said Quaiattini.

Final regulations for the two per cent mandate on biodiesel were tabled by the federal government on Sept. 1, he said, and the only step now required from the government is the finalization of a start date for the mandate.

The government has committed to bring the mandate forward in 2011, and the Ottawa-based CRFA has formerly requested a start date of April 1, 2011, with a first compliance period ending Dec. 31, 2012.

“There is certainly an interest to make sure that the final decision-making process takes place in a timely manner,” said Quaiattini.

The government had initially requested some additional technical work done studying biodiesel usage in Canada’s climate, he said. All of the demonstration projects are now complete and the findings have been tabled with Environment Canada.

“As far as we’re concerned, they have all of the data, all of the information, all of the work on technical feasibility,” said Quaiattini. As a result, he was confident an official announcement on the biodiesel mandate start date would be forthcoming.

“The sooner the government sends the signal… the additional capacity we need to build out beyond what we already have will move very quickly,” said Quaiattini, noting a biodiesel plant can be built much faster than an ethanol facility.

Canada currently has the capacity to produce just over 200 million litres of biodiesel on an annual basis, and would need a capacity of 500 million litres to meet the projected demand of a two per cent mandate, said Quaiattini.

Projects currently in the planning stages would easily take the total capacity over that 500 million-litre level, he said.

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Phil Franz-Warkentin writes for MarketsFarm specializing in grain and commodity market reporting.

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