The federal government on Monday announced the bill that will give it the power to regulate renewable fuel content in Canadian gasoline and diesel, as well as details on a previously announced incentive program for production of homegrown biofuels.
The biofuels bill will make the changes to ensure Ottawa meets its goal of average content of five per cent ethanol by 2010 and two per cent biodiesel by 2012 in Canadian gas and diesel fuel respectively, Agriculture Minister Gerry Ritz told a renewable fuels conference in Quebec City.
The renewable fuel standard is expected to eventually result in the equivalent of taking over a million cars off Canada’s roads, in terms of net greenhouse gas emission reduction.
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The government also finalized details for its $1.5 billion ecoEnergy for Biofuels program, first announced in July. The program will provide incentives of up to 10 cents per litre for biofuel alternatives to gasoline and up to 20 cents per litre for diesel alternatives for the first three years, declining each year afterward to maximums of four and six cents respectively by 2016-17.
The rates paid to biofuel producers, as set out in their individual contribution agreements, will be based both on each project’s profitability margin and on the weighted average of the individual margins of each eligible recipient of these incentives. The incentive will be 50 per cent of the difference between the profitability margin and industry margin.
Eligible recipients under this program must be for-profit legal entities that own individual plants or facilities and are “not subject to a controlling interest by a federal, provincial or municipal government.”
“Biofuels like ethanol are better for the environment, better for farmers and
rural economies, and better for energy supply and gas prices,” said Bliss Baker, vice-president of Ontario corn-based ethanol producer GreenField Ethanol, in a separate release. “This new
biofuels bill coupled with the ecoEnergy program will mean more jobs in a
vital and growing sector of the energy industry.”
