MnSP to restart biodiesel production
BREWSTER -- When President Barack Obama signed the 2010 tax relief bill on Friday, making the biodiesel tax credit retroactive to Jan. 1 and extending it through the end of 2011, the phones began to ring at Minnesota Soybean Processors (MnSP).
Orders for the soy-based diesel fuel had slowed when the $1-per-gallon tax credit was allowed to expire on Dec. 31, 2009. In May, MnSP spokesperson Kim Collin said the Brewster plant had already cut back on biodiesel production. It was stopped entirely Nov. 23.
On Monday, Collin said there was enough biodiesel in storage to fill the orders MnSP has received in recent days. Production will begin again as soon as possible.
"For us (the tax credit) means we will increase our production of biodiesel again," said Collin. "We are looking to be back up to full production within two months."
The pause in biodiesel production at the plant never led to layoffs, which is why Collin said production will be able to be resumed so quickly. Other plants in the state will likely need more time to ramp up. When the tax credit expired at the end of 2009, three of Minnesota's four biodiesel plants stopped production.
"It will definitely be to our benefit ... that we had not shut down our biorefinery," Collin said. "We'll be able to handle the demand much quicker."
Workers who had been utilized in other areas at MnSP will return to work in the refinery in early January.
With the tax credit reinstated and the Renewable Fuels Standard 2 (RFS2) upheld despite a number of court challenges in 2010, the biodiesel industry is once again looking up. RFS2 calls for an increase in renewable fuels production from 10 million gallons to 36 million gallons annually by 2022. The standard will increase the amount of renewable fuel required to be blended into transportation fuel sold in the U.S., in hopes of reducing greenhouse gases.
In order to reach the RFS2 goal, Collin said the biodiesel tax credit will need to be kept in place.
"We're still a relatively young industry," said Collin. The tax credit has not only helped to create and sustain biorefineries, it has also helped the country move toward "greener fuel," she added.
With the biodiesel tax credit extended only through 2011, Collin said the industry cannot rest and will need to begin working on another extension as soon as possible.
"It took a whole year to get (this extension) done," she said. "We hope we don't have this issue again at the end of 2011."
Collin encouraged soybean farmers to stay in contact with their legislators and encourage them to support another extension.