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May 15, 2014 10:45 AM, EDT
Biodiesel Board Hits ‘Weak’ Renewable Fuel Proposal
Micah Walter/Bloomberg News

A survey by the National Biodiesel Board found that nearly 80% of biodiesel producers have scaled back production this year, and more than half have idled production, due in part to what it called a “weak” renewable fuel standard proposal in Washington.

Two-thirds of producers said they have reduced or anticipate reducing their workforce as a result of the downturn, which the group says follows “a weak [RFS] proposal” from the Environmental Protection Agency and Congress’ failure to extend a biodiesel tax incentive.

“Inconsistency in Washington is wreaking havoc on the U.S. biodiesel industry,” Anne Steckel, the group’s vice president of federal affairs, said in a statement.

“It’s not just hurting these producers. It is a setback for local economies where these plants operate, for our environment, for our national energy security and for drivers who are tired of ever-increasing fuel prices that result from the petroleum industry’s monopoly at the pump,” Steckel said.

The RFS, which has not been finalized, would establish a biodiesel standard of 1.28 billion gallons this year — a sharp cut from last year’s record production of nearly 1.8 billion gallons that likely would force many producers to shut their doors.

The survey also found that:

• 78% of producers have reduced production from last year;

• 57% have idled production altogether or shut down a plant this year;

• 66% have reduced workforce or anticipate reducing workforce; and

• 85% have delayed or canceled expansion plans.