Canada renewable fuel body wants quotas doubled

VANCOUVER – Canada’s renewable fuels industry is pressing the federal government to double the percentage of renewable fuels it will require in gasoline and diesel, the head of the industry association said on Tuesday.

The Canadian Renewable Fuels Association wants Ottawa to raise the ethanol-in-gasoline mandate from 5 per cent to 10 per cent and the still-to-be-implemented biodiesel threshold from 2 per cent to 5, body president Gordon Quaiattini said.

Canada’s 5 per cent ethanol requirement takes effect across Canada on Dec. 15 after the government passed federal renewable fuel regulations into law in September. Several provinces already have ethanol mandates in place.

A start date for the 2 per cent renewable content in diesel has not yet been set but Ottawa has committed to implementing it in 2011, Quaiattini said.

“We are absolutely talking to government about wanting to expand those mandates,” Quaiattini told Reuters in an interview on the day the association released a report on the state of the fledgling industry.

The document comes a day after the U.S. Environmental Protection Agency said ethanol and other renewable fuels must account for at least 8.01 per cent of the motor fuels sold in 2011 at U.S. service stations to comply with a federal mandate.

The Canadian government has been a strong supporter of the domestic biofuel industry as it tries to find new markets for farmers, create jobs and cut greenhouse gas emissions.

It has set aside C$1.5 billion ($1.48 billion) over nine years to invest in the sector, which generates about 2 billion litres of biofuel a year. The sector has grown exponentially in Canada in the past five years but still only makes up 2 per cent of biofuels produced worldwide and 4 per cent of U.S. output.

Most of the ethanol in Canada is made from corn and is blended across the country by major oil companies, including Suncor Energy Inc SU.TO and Husky Energy Inc HSE.TO. Biodiesel is made from various feedstock including canola, animal fats and waste oils.