BP to Acquire Clean Energy’s Upstream RNG Business & Sign Long-Term RNG Supply Agreement with Clean Energy

CHICAGO, Ill. and NEWPORT BEACH, Calif. – BP p.l.c. (NYSE: BP) and Clean Energy Fuels Corp. (Nasdaq: CLNE) today announced that BP will acquire the upstream portion of Clean Energy’s renewable natural gas business and sign a long-term supply contract with Clean Energy to support the firm’s continuing downstream renewable natural gas business. The deal enables both companies to accelerate the growth in renewable natural gas supply and meet the growing demand of the natural gas vehicle fuel market.

Renewable natural gas fuel, or biomethane, is produced entirely from organic waste.  As a fuel for natural gas vehicle fleets, including heavy-duty trucks, it is estimated to result in 70 percent lower greenhouse gas emissions than from equivalent gasoline or diesel fueled vehicles.

Under terms of the agreement, BP will pay $155 million for Clean Energy’s existing biomethane production facilities, its share of two new facilities and its existing third party supply contracts for renewable natural gas. Closing the transaction is subject to regulatory approval. Clean Energy will continue to have access to a secure and expanding supply to sell to the growing customer base of its Redeem™-branded renewable natural gas fuel through a long-term supply contract with BP.

“Demand for renewable natural gas is growing quickly and BP is pleased to expand our supply capability in this area,” said Alan Haywood, chief executive officer of BP’s supply and trading business. “BP is committed to supporting developments towards a lower carbon future and, working with Clean Energy, we believe we will be well-positioned to participate in the growth of this lower carbon fuel in the U.S.”

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Miron Construction to Finish Work on Big Ox Renewable Natural Gas Facility

Miron Construction Co., Inc., in partnership with McMahon Group, is constructing a renewable natural gas generation facility for Big Ox Energy in Denmark, Wisconsin. Work on the project began in October 2016 and is scheduled to be complete in December 2017.

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The Prospects for Tax Reform in Trump Town

By Squire Patton Boggs, Lexology.

With the 115th Congress nearing the end of month two, tax reform continues to be a focal point of the political debate in Washington. Intent to move forward with their tax reform “Blueprint” released in June 2016, Speaker Paul Ryan (R-WI), House Ways and Means Committee Chairman Kevin Brady (R-TX), and other high-profile tax-writers have spent a significant amount of time and energy in recent weeks promoting their proposal, which would dramatically overhaul the U.S. tax system and make significant reforms to the Internal Revenue Service (IRS). Though initial expectations were that the text of the Blueprint might be available as early as March, Chairman Brady has since indicated that he now hopes to have the legislation released “during the first half of the year,” which likely means that the text of the bill will be finalized by June of this year.

Once the legislation is drafted, it will then be taken up and debated by the Ways and Means Committee – a process that will likely be contentious given the current political divide in Washington. That divide, however, is not solely a partisan one; signs of GOP discontent can be seen in the Senate (and, according to our sources, can also be seen even among House Ways and Means Republicans) and could potentially extend to the White House. The main issue dividing Republicans at the moment? The Blueprint’s Border Adjustable Tax (BAT), which would essentially: (1) disallow deductions for imports when calculating the cost of goods sold; and (2) exclude revenues earned from exporting goods from taxable income.

Though Senate Republicans have generally avoided opposing BAT outright, several influential Senators have either expressed concerns about the proposal or indicated that they have doubts and are thus withholding judgement. Perhaps the most vocal opponent of BAT to date has been Senator David Perdue (R-GA) who recently sent around a “Dear Colleague” letter arguing that the BAT is “regressive, hammers consumers, and shuts down economic growth.” Opposition in the Senate appears to be growing. In fact, concerned about the rhetoric coming out of the Senate on the BAT, Speaker Ryan recently began outreach to Republican Senators urging them to “keep their powder dry.” Reports suggest that his visits have not been well-received and are, at best, having minimal impact in the Upper Chamber. Notably, despite the most recent efforts by the Speaker, the skepticism in the Senate seems to be growing, with Senate Finance Committee Chairman Orrin Hatch (R-UT) just last week acknowledging he “[does not] see [BAT] happening, not the way the House has configured it.”

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EPA Chief Announces Rollback of Three Obama Regulations to Begin Soon

In a speech, the agency head mentioned the Clean Power Plan, methane standards and the Waters of the United States rule as targets.

By Emily Holden, E&E ClimateWire, via Scientific American.

NATIONAL HARBOR, Md. — U.S. EPA Administrator Scott Pruitt on Saturday rallied conservatives and promised to rein in the agency.

Speaking at the Conservative Political Action Conference, Pruitt said he would focus on adhering to the formal rulemaking process and stick to the confines of federal law. At the same time, the new administrator said he would promote clean air and water and clean up Superfund sites.

"There’s some very important work to protect and provide leadership in the government space. But what’s happened in the last several years is the previous administration was so focused on climate change and so focused on CO2 that some of those other priorities were left behind," Pruitt said.

"We as Republicans don’t have anything to be apologetic about with respect to the environment. Nothing. We have always believed that you can grow jobs and grow the economy while also ... being a good steward of the environment."

Pruitt hinted at big action this week to start rolling back controversial environmental regulations.

"I think there are some regulations that in the near term need to be rolled back in a very aggressive way," he said. Others may take longer, he noted. In particular, he mentioned the Clean Power Plan, methane standards for the oil and gas industry, and the Waters of the United States rule. Pruitt added that "executive agencies only have the power that Congress has given them."

A former college baseball player, Pruitt repeatedly used a slogan coined by legend Yogi Berra.

"The future ain’t what it used to be," Pruitt told attendees who stood and applauded for him in the closing hours of CPAC.

Still, he said that when he made his first address to staff last week, he "wanted to send a message to the agency that there are some very important things EPA does."

Pruitt said states care about clean air and water and are "partners, not adversaries." The new EPA administrator said he would devote resources to visit governors and work with them. One of his first official acts last week was to sit down with Texas Gov. Greg Abbott (R).

While Pruitt touted his support for a clean environment, his reported hiring picks suggest he will focus mostly on nixing regulations. To lead his Office of Policy, Pruitt will choose Samantha Dravis, who aided in fights against EPA in senior roles with the Republican Attorneys General Association and its affiliated Rule of Law Defense Fund, according to Axios.

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White House Proposes 24% Cut to EPA Budget

By Jennifer A. Dlouhy, Bloomberg.

President Donald Trump’s plan to slash the Environmental Protection Agency’s $8.3 billion budget would almost certainly mean making deep cuts to programs that protect the air and water and invoke fierce protests from environmentalists.

That’s because roughly two out of every five dollars dedicated to the EPA ends up steered to state, tribal and local governments. Even Trump’s own advisers and the new EPA administrator, Scott Pruitt, say the agency’s state environmental grants are off limits. That means the administration would need to reduce the EPA’s already tight budget for enforcing environmental laws and its legally mandated portfolio of other work, said John Coequyt, global climate policy director for the Sierra Club.

Opponents plan to fan public outrage, tapping into a movement that has pushed angry constituents to pack lawmakers’ town hall meetings to complain about proposed changes to the Affordable Care Act. And in the same way that widespread fondness for Big Bird once helped insulate public broadcasting -- and the flagship show "Sesame Street" -- from evisceration, critics are ready to highlight how budget cutbacks at EPA headquarters translates to air pollution in the heartland and lead pipes delivering drinking water in cities nationwide.

"The core premise here is that they can make very substantial cuts to the agency, leaving alone the state and local grant side, which is roughly half the budget," Coequyt said in a phone interview. "We have real doubts that can be done without substantially weakening the ability of EPA to respond to environmental problems and to carry out its core functions that are all established in law."

That may be the intended goal. Trump has consistently lambasted the agency -- once saying it should disappear altogether -- and criticized EPA regulations that he says burden companies, throttle energy development and delay factory construction.

The EPA is one of the the Trump administration’s top targets as it lays out plans to boost defense spending by $54 billion annually using money freed up by broad reductions across the rest of the government’s discretionary budget. It will take more than the EPA to get there; the agency is operating with an $8.3 billion budget and about 15,000 workers this year -- roughly the same spending level it has maintained for six years.

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U.S. DOE Publishes Biorefinery Optimization Workshop Summary Report

Via U.S. Department of Energy.

The Biorefinery Optimization Workshop Summary Report is now online! Read this new report for an overview of industry challenges and opportunities discussed during the Biorefinery Optimization Workshop, which was held on October 5–6, 2016, in Chicago, Illinois.

The U.S. Department of Energy’s Bioenergy Technologies Office hosted more than 100 biorefinery stakeholders at the workshop to collect input regarding the current capabilities, barriers, and opportunities for integrated biorefineries working to produce biofuels, biochemicals, and bioproducts.

Specific areas of focus included the following:

• Feedstock and Materials Handling 
• Process Scale-Up, Intensification, and Cost Reduction 
• Co-Product and Waste Stream Monetization.

Industry experts began the Biorefinery Optimization Workshop with presentations summarizing current trends related to the event areas of focus. Stakeholder attendees representing academia, research institutions and laboratories, and industry participated in breakout sessions to provide their perspectives on challenges and opportunities related to biorefinery optimization as well as ideas for next steps in achieving reliable and continuous operation of biorefineries.

Visit the workshop page to learn about the event and read the workshop summary report.

Organics may offer most growth potential for creating renewable energy from waste

Combustion remains steady, but most of the action right now is in RNG.

By Cole Rosengren, Waste Dive.

Energy is among the many byproducts created during the waste management process, but in height of the country’s current clean power push, the industry’s role has yet to reach its full potential.

The waste industry has been creating various forms of energy from waste for decades, however output levels are still smaller than renewable sources such as wind or solar. While growth in the thermal conversion sector may be limited in the coming years, interest in new projects to create energy from landfill gas or anaerobic digestion is high. Spurred by federal incentives for transportation fuel and new state policy regulations, organic material may hold the key to making waste a bigger part of the country’s clean energy transformation.

"Food waste is the fastest growing component of the municipal waste stream and if you look at what is the technology that's best-suited to manage food waste, you come to either anaerobic digestion or composting," said Stephen Simmons, a senior vice president at the consulting firm Gershman, Brickner & Bratton. "That material isn't well-suited for a big combustion plant or a gasification plant."

Deciding which technology is right for each portion of the waste stream revolves around many economic and geographic factors, with the potential energy value shifting as well. As highlighted by a new report from the Business Council for Sustainable Energy and Bloomberg New Energy Finance, the U.S. energy market is competitive and average prices are low. This makes projecting the growth potential for different sectors a complicated process.

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Fleet Owners, Retailers Tell EPA to Keep Renewable Fuel Standard Compliance Model

 By Jessica Lyons Hardcastle, Environmental Leader.

UPS, 7-Eleven and Casey’s General Store are among the three dozen companies and trade organizations urging the EPA to keep the current compliance standard under the Renewable Fuel Standard (RFS).

The public comment period on the biofuel blending mandate ended yesterday.

Last year a group of oil refiners petitioned the EPA to change the “point of obligation” under the Renewable Fuel Standard. Under the current RFS rules, oil refiners are the parties obligated to blend more renewable fuel into the nation’s transportation fuel supply. The refiners want the EPA to change the obligated party from the refinery to the owners of the gasoline before it is blended for retail sale.

In November, the Obama administration’s EPA proposed denying the refiners’ request. But the final decision will be up to President Donald Trump’s EPA, now headed by Scott Pruitt. And the oil industry, which is central to the Oklahoma economy that Pruitt had represented as his state’s attorney general, is hoping for more sympathetic rules under the new leadership.

On Tuesday, as the RFS public comment period came to a close, a group of truck drivers, railroads, renewable fuel groups and fuel retailers, organized by the National Association of Truck Stop Operators (NATSO), told the agency that shifting the point of obligation downstream in the supply chain would undermine the purpose of the renewable fuel mandate and raise prices at the pump.

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Fuelling Solid Waste Fleets with Renewable Natural Gas

By Sarah Stadnyk, Solid Waste & Recycling.

With the transportation sector contributing the largest portion of greenhouse gas (GHG) emissions in Canada, renewable natural gas (RNG) from food waste and organic material is the next game-changer in vehicle fuelling and the biggest opportunity for near-term, cost-neutral sustainability.

RNG can be generated from any source where organics undergo anaerobic digestion, such as landfills, residential source separated organics treatment facilities, and wastewater treatment. RNG is cost-competitive with diesel fuel, interchangeable with natural gas, and carbon neutral.

“Farms and municipalities are well-positioned to convert their biogas to RNG, a locally produced alternative fuel suitable for on-farm use and for trucking fleets,” says Jennifer Green, executive director of the Canadian Biogas Association.

Fuelling with RNG is an excellent opportunity for the solid waste sector, as they can locally produce vehicle fuel on-site for their fleets. “For the waste industry, RNG just makes sense,” says Bruce Winchester, executive director of the Canadian Natural Gas Vehicles Alliance. “Fifty per cent of fleets in North America are natural gas powered anyway, taking the product they carry around and making it a fuel is the perfect way to close the loop.”

Environmental Benefits of RNG

Generating biogas from landfill gas (LFG) and diverting organics to biogas facilities has several environmental benefits. The 2013 Canadian Biogas Study by Kelleher Environmental found that converting just half of the food waste discarded in Canada into biogas would avoid 2.2 million tonnes of CO2 emissions per year, the equivalent of taking 490,000 cars off the road. The biogas process recovers nutrients from organic waste and returns them to the soil, resulting in improved soil health. Water sources are protected by destroying pathogens in organic material, which reduces the risk of potential environmental impact.

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Report: Trump executive orders to target Clean Power Plan, coal production, water rules

By Robert Walton, Utility Dive.

Dive Brief:

• Following several media reports that the new Trump administration has been preparing to roll back energy and environmental restrictions put in place by President Obama, The Washington Post now reports the actions will target power plant emissions, coal production and clean water rules.
• One executive order will direct the U.S. Environmental Protection Agency to begin rolling back the Clean Power Plan, while others will address coal production and federal water, the Post reports. The orders are expected as early as this week.
• Newly-confirmed EPA Administrator Scott Pruitt yesterday told employees of the agency that he is ready to work with them, but the former attorney general of Oklahoma also stressed the agency would have a respect legislation as it is written and will focus on maintaining market certainty.

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