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Canadian government unveils $1.5 billion biofuels plan
Canada's Prime Minister Stephen Harper announced a substantial investment to boost Canada’s production of biofuels. Under ecoENERGY for Biofuels, the government will provide up to $1.5 billion (€1.05/US$1.429bn) in the form of incentives (subsidies) over nine years to producers of renewable alternatives to gasoline and diesel fuel.
Last December, Canada’s New Government announced a new regulation requiring a five per cent average renewable content in gasoline by 2010. At that time, the government also signalled its intention to develop a similar requirement of two per cent renewable content for diesel and heating oil by 2012.
The 'ecoENERGY for Biofuels' program has four main pillars:
1. Increasing the retail availability of renewable fuels through regulation
Regulations under development by Environment Canada will require 5% renewable content based on the gasoline pool by 2010 and 2% renewable content in diesel and heating oil by 2012, upon successful demonstration of renewable diesel fuel use under the range of Canadian conditions. The announcement was made in December 2006 and Environment Canada issued a Notice of Intent in the Canada Gazette later that month.
These new regulations will require enough renewable fuel to reduce greenhouse gas (GHG) emissions by about 4 megatonnes per year, the GHG equivalent of taking almost one million vehicles from the road:
biofuels :: energy :: sustainability :: climate change :: greenhouse gas emissions :: ethanol :: biodiesel :: heating oil :: Canada ::
2. Supporting the expansion of Canadian production of renewable fuels
On July 5, 2007, Prime Minister Stephen Harper announced the ecoENERGY for Biofuels Initiative, which will invest up to $1.5 billion over 9 years to boost Canada’s production of renewable fuels such as ethanol and biodiesel.
The initiative will provide operating incentives to producers of renewable alternatives to gasoline and diesel based on production levels and other factors. It will make investment in production facilities more attractive by partially offsetting the risk associated with fluctuating feedstock and fuel prices.
Budget 2007 also states that concurrent with the implementation of the operating incentive program to promote additional domestic production of renewable fuels, the current fuel excise tax exemptions for ethanol and biodiesel will be eliminated as of April 1, 2008.
3. Assisting farmers to seize new opportunities in this sector
On April 23, 2007, the Minister of Agriculture and Agri-Foods officially launched the ecoAGRICULTURE Biofuels Capital Initiative(ecoABC) a new $200 million initiative that will provide repayable contributions of up to $25 million per project to help farmers overcome the challenges of raising the capital necessary for the construction or expansion of biofuel production facilities.
In March 2007, the Minister of Agriculture and Agri-Foods announced a $10 million expansion to the Biofuels Opportunities for Producers Initiative, which helps agricultural producers develop sound business proposals, as well as undertake feasibility or other studies to expand biofuels production capacity.
4. Accelerating the commercialization of new technologies
Budget 2007 also makes $500 million, available over eight years to Sustainable Development Technology Canada (SDTC) to invest with the private sector in establishing large-scale facilities for the production of next-generation renewable fuels. Next-generation renewable fuels, produced from non-food feedstocks such as wheat straw, corn stover, wood residue and switchgrass, have the potential to generate even greater environmental benefits than traditional renewable fuels.
The measure complements research and development initiatives including the following:
References:
Canadian Government: Government’s new biofuels plan a double win: Good for the environment and farmers - July 5, 2007
Canadian Government, Natural Resources: ecoENERGY for Biofuels.
Canadian Government: EcoAction: Biofuels.
Last December, Canada’s New Government announced a new regulation requiring a five per cent average renewable content in gasoline by 2010. At that time, the government also signalled its intention to develop a similar requirement of two per cent renewable content for diesel and heating oil by 2012.
With the transportation sector accounting for more than a quarter of Canada’s greenhouse gas output, increasing the renewable content in our fuel is going to put a real dent in emissions. With leading-edge technology and abundant supplies of grains, oilseeds, and other feedstocks, Canada is uniquely positioned to become a global leader in the production of biofuels. - Stephen Harper, Canada's Prime MinisterClose to three billion litres of renewable fuels will be needed annually to meet the requirements of the new regulations. Canadian production in 2006 was only about 400 million litres, so the expansion will represent 'a tremendous economic opportunity' for the country’s 61,000 grain and oilseeds producers.
The 'ecoENERGY for Biofuels' program has four main pillars:
1. Increasing the retail availability of renewable fuels through regulation
Regulations under development by Environment Canada will require 5% renewable content based on the gasoline pool by 2010 and 2% renewable content in diesel and heating oil by 2012, upon successful demonstration of renewable diesel fuel use under the range of Canadian conditions. The announcement was made in December 2006 and Environment Canada issued a Notice of Intent in the Canada Gazette later that month.
These new regulations will require enough renewable fuel to reduce greenhouse gas (GHG) emissions by about 4 megatonnes per year, the GHG equivalent of taking almost one million vehicles from the road:
biofuels :: energy :: sustainability :: climate change :: greenhouse gas emissions :: ethanol :: biodiesel :: heating oil :: Canada :: 2. Supporting the expansion of Canadian production of renewable fuels
On July 5, 2007, Prime Minister Stephen Harper announced the ecoENERGY for Biofuels Initiative, which will invest up to $1.5 billion over 9 years to boost Canada’s production of renewable fuels such as ethanol and biodiesel.
The initiative will provide operating incentives to producers of renewable alternatives to gasoline and diesel based on production levels and other factors. It will make investment in production facilities more attractive by partially offsetting the risk associated with fluctuating feedstock and fuel prices.
Budget 2007 also states that concurrent with the implementation of the operating incentive program to promote additional domestic production of renewable fuels, the current fuel excise tax exemptions for ethanol and biodiesel will be eliminated as of April 1, 2008.
3. Assisting farmers to seize new opportunities in this sector
On April 23, 2007, the Minister of Agriculture and Agri-Foods officially launched the ecoAGRICULTURE Biofuels Capital Initiative(ecoABC) a new $200 million initiative that will provide repayable contributions of up to $25 million per project to help farmers overcome the challenges of raising the capital necessary for the construction or expansion of biofuel production facilities.
In March 2007, the Minister of Agriculture and Agri-Foods announced a $10 million expansion to the Biofuels Opportunities for Producers Initiative, which helps agricultural producers develop sound business proposals, as well as undertake feasibility or other studies to expand biofuels production capacity.
4. Accelerating the commercialization of new technologies
Budget 2007 also makes $500 million, available over eight years to Sustainable Development Technology Canada (SDTC) to invest with the private sector in establishing large-scale facilities for the production of next-generation renewable fuels. Next-generation renewable fuels, produced from non-food feedstocks such as wheat straw, corn stover, wood residue and switchgrass, have the potential to generate even greater environmental benefits than traditional renewable fuels.
The measure complements research and development initiatives including the following:
- ecoENERGY Technology Initiative
- Forestry innovation
- Agricultural Bioproducts Innovation Program (Agriculture and Agri-Food Canada)
- Agri-Opportunities Program (not applicable to transportation fuels) (Agriculture and Agri-Food Canada)
- Sustainable Development Technology Canada (existing funds)
References:
Canadian Government: Government’s new biofuels plan a double win: Good for the environment and farmers - July 5, 2007
Canadian Government, Natural Resources: ecoENERGY for Biofuels.
Canadian Government: EcoAction: Biofuels.
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