Comment Log Display

October 8, 2009

Clerk of the Board, Air Resources Board
1001 I Street
Sacramento, California 95814

Electronic submittal:
http://www.arb.ca.gov/lispub/comm/bclist.php
Comments on:  Second Notice of Public Availability of Modified
Text and Availability of Additional Documents and Information

Thank you for incorporating some of A 2nd Opinion, Inc.'s (A2O)
earlier comments into the Low Carbon Fuel Standard (LCFS)
regulations. However, there are some remaining issues and our
intent is that the following comments will result in a better
regulation.
§95480.1(c)(2):
This section exempts Liquefied Petroleum Gas (LPG or "propane")
from the LCFS regulation.  This exemption creates a problem for the
renewable propane that is coproduced with renewable diesel.  It
denies this perfectly good low carbon fuel a role in the LCFS.  
To resolve this problem you could keep LPG in the LCFS.  But doing
so would create a lot of paperwork and record keeping to track a
relatively small volume of renewable fuel use in a relatively small
market segment.  Even if you acknowledge that renewable propane and
fossil propane are chemically identical and treat renewable propane
like renewable electricity (the renewable producer mixes the
renewable product with non-renewable product and then sells the
right to the buyer to call his purchase of fungible product
renewable) there would be a lot of recordkeeping for no benefit. 
(The carbon reduction occurs regardless of whether the accounting
is difficult or easy.)  It would be much more efficient to modify
the renewable diesel life cycle analyses (LCA) to allow the net
renewable propane energy and carbon to be credited to the renewable
diesel production and to leave the propane exemption in
§95480.1(c)(2)in place.
§95485(a)(1) Table 4.  Biomass-based diesel  has various per
gallon energy contents ranging from about 125 to 132 MJ/gal.  How
can CARB use one conversion factor, 126.13 MJ/gal, to convert all
gallons of biomass-based diesel to MJ?  Also, biodiesel tends to be
in the low end of the range while renewable diesel is in the high
end.  If there is a compelling reason to standardize the conversion
factor, how about using one factor for biodiesel and another for
renewable diesel?
§95486(b)(1)(O) The pathway "Stationary Source Division, Air
Resources Board (September 23, 2009, v.12), “Detailed
California-Modified GREET Pathway for Co-Processed Renewable Diesel
Produced in California from Tallow (U.S. Sourced);” is not ready to
become law.  

Transportation assumption
The assumption that co-processed renewable diesel is distributed
by truck is simply false.   Co-processed renewable diesel will not
be separated from the ULSD that it is processed with.  Therefore
its distribution energy and carbon numbers should be identical to
ULSD.
Transportation & Distribution
	          Energy, Btu/mmBtu	 Emissions, gCO2e/MJ
Renewable Diesel	8662	               0.66
ULSD	                4721	               0.33
Difference	        3941	               0.33
Admittedly this is not a big error, but methodology should match
reality.  

Separately processed renewable diesel will also be blended with
ULSD prior to distribution because that is the optimum blending
location.  If the renewable diesel production facility is adjacent
to a refinery its distribution energy and emissions will be
identical to ULSD.  If the renewable diesel facility is not
adjacent to a California refinery then there should and will be
energy and emissions factors associated with delivering it to the
refinery. 

Tank to wheels emissions
Another small but needed for reality adjustment involves the tank
to wheels emissions.  The Biodiesel Renewable Diesel Research
Program is confirming the renewable diesel reduces the tank to
wheel emissions relative to CARB ULSD.  This adjustment only
amounts to a little over a tenth of a gCO2e/MJ.  Consistent
application of the adjustment will also increase tank to wheels
emissions for biodiesel.  But, we really must make methodology
match reality because the integrity of the LCFS depends on paying
attention to the details of reality.

Co-product credits
§95480.1(c)(2) which exempts propane for the LCFS creates a
dilemma about what to do with and how to account for the renewable
propane that is co-produced with renewable diesel.  

Renewable propane is a low carbon fuel that belongs in the LCFS. 
It takes less energy to produce than it gives back.  The fossil
carbon emitted during its production is less than the fossil carbon
displaced when it is burned or used as a hydrogen plant feedstock. 
When renewable diesel is made from animal fats or vegetable oils
its production is unavoidable.  Whether the biomass is co-processed
with petroleum diesel or processed in a separate renewable diesel
production facility the renewable propane is going to displace
fossil propane.  We have a choice.  We can either simply take net
energy and CO2 credits similar to the bagasse credits taken in the
“Detailed California-Modified GREET Pathway for Brazilian Sugarcane
Ethanol;” or create complex regulations and accounting procedures
to track it.  Let's look at some examples of what might be needed.

If the renewable propane is used as renewable diesel process plant
fuel the bagasse like credit is obviously the proper path.  If it
is used as hydrogen plant feed in a hydrogen plant that is
dedicated to the renewable diesel plant again the  bagasse like
credit is obviously the proper path.  But, if the low carbon
hydrogen produced from the renewable propane is shared with either
an adjacent refinery for separate processed renewable diesel or the
host refinery for co-processed renewable diesel things get messy
fast.  We now need to account for and track low carbon gasoline and
diesel fuel that was desulfurized using some of the low carbon
hydrogen throughout the distribution system.   Similarly if some of
the renewable propane ends up in a refinery's fuel gas system we
also have to track low carbon gasoline and diesel fuel.  If it were
recovered and sold as LPG, we must keep LPG in the LCFS and set up
tracking methodology and regulations.  Rather than go through this
it would be better if the renewable diesel pathways used a
coproduced energy/CO2 credit model like used in the sugarcane to
ethanol pathway rather than the co-product allocation model used
for biodiesel and corn ethanol.  This allows us to greatly simplify
both the LCFS regulations and the LCA pathway for renewable diesel
made from animal fats and/or vegetable oils. 

The LCA pathway can be simplified by acknowledging that renewable
diesel production processes are really just renewable fuel
production processes.  Renewable diesel can simply bear all of the
energy and fossil carbon inputs to the pathway less relatively
small renewable propane energy and CO2  credits.   We do not have
to wonder if we should allocate based upon weight, value or energy
content.  We simply let the desired product carry the load and take
credits for the renewable fuel byproducts just like the bagasse
energy and CO2 credits taken in the "Detailed California-Modified
GREET Pathway for Brazilian Sugar Cane Ethanol".  This methodology
is simpler and more robust than the pathways that have non energy
co-products and therefore is the appropriate pathway for this
product.

The LCFS regulations are greatly simplified because the renewable
propane does not have to be accounted for after the credits are
taken in the pathway.  CARB does not have to concern itself with
accounting for low carbon hydrogen produced from renewable propane.
 CARB does not have to account for low carbon gasoline and diesel
fuel produced in refineries that use low carbon hydrogen for
desulfurization processes or burn the renewable propane in their
fuel systems.  CARB can continue to exclude propane from the LCFS.

In the interest of developing simpler regulations and LCA's that
more closely model reality CARB should revise all renewable diesel
pathways from animal fats and/or vegetable oils before they become
law.

§95487(c)(3) and §95487(c)(3)(B) continue to use the term
'biomass-based diesel".  Because renewable diesel is both a diesel
fuel as defined in 13 CCR §2281(b) which is exempt from the
multimedia requirement under §95487(c)(2)(B) and a biomass-based
diesel fuel as defined in §95481 (a)(9),  the term "'biomass-based
diesel" in §95487(c)(3) and §95487(c)(3)(B) should be edited to
read "biodiesel" and the term "renewable diesel," should be
inserted in §95487(c)(2)(B) between "...diesel fuel," and
"E100,..."  
Do not hesitate to call me if you have questions.
For A 2nd Opinion, Inc on behalf of its client Neste Oil.

Cal Hodge
Because some formatting was lost when copying comments into
submission form a signed PDF file is also being attached.