Trucking Industry Raises Concerns to Changes in Renewable Diesel Regulations

The Renewable Diesel and Sustainable Aviation Fuel Parity Act, a bill currently floating in Congress, is raising some concerns for trucking industry advocates such as the American Trucking Association and Truckload Carriers Association. Lawmakers have indicated that if the bill passes, it would help increase diesel fuel production while maintaining the status quo. Trucking industry experts, however, fear that the bill’s passage will create confusion which could make meeting emissions regulations more difficult, and cost fleets money at the same time.

“In light of the recent Securities and Exchange Commission proposed rule that requires certain companies to report climate-related risks, it is imperative that truck drivers have seamless access to information regarding the environmental characteristics of the fuel that they purchase,” a joint letter sent to lawmakers reportedly said. “The renewable diesel label provides that information. Were it to be eliminated, it would be exceedingly complicated and expensive for retailers and trucking firms to ascertain the carbon footprint of their activities.”

According to California Senator Diane Feinstein, the act would encourage the following three things:

  • Require the Energy Information Administration to report on U.S. production and foreign imports of renewable diesel and sustainable aviation fuel, including the type, origin, and volume of feedstocks used for these fuels.
  • Allow renewable diesel and sustainable aviation fuel production facilities to qualify for the Department of Energy’s Title XVII loan guarantees under the Energy Policy Act of 2005.
  • Exempt renewable diesel that meets the same technical specifications as petroleum-based diesel from the labeling section of the Energy Independence and Security Act of 2007.

While in agreement with the first two points, it’s the last bullet point that is cause for concern for trucking industry advocacy organizations. Glen Kedzie, Energy and Environmental Counsel for the American Trucking Association, contends that eliminating the renewable diesel label would allow refineries to commingle the product with petroleum brands. His thinking revolves around oil refinery industry practices and profits.

“But removing the RD label would cut into the fuel cost discounts that trucking companies get at retail. The label ensures that every gallon of renewable diesel is segregated from petroleum diesel through the supply chain. If they can commingle the fuel, fleets won’t know what they are buying and the cost will be higher because renewable diesel will then need to be priced the same as petroleum diesel,” Kedzie reportedly said. “If producers can commingle the fuel, they would be able to access a tax credit. However, fleets would lose out. Fleets would pay a higher price for fuel, and it would not be completely transparent as to what is going in the truck tank.”

The bill appears to be gaining a surprising amount of bipartisan support since its introduction in April while the trucking industry has made a point to voice their concerns surrounding the impact of the labeling portion of the bill.