The biodiesel news that two members of Gov. Mark Dayton’s cabinet shared with an appreciative audience at Farmfest on Thursday really isn’t new. An increase from 10 percent (B10) to 20 percent (B20) in Minnesota’s required blend of plant- or animal-derived oil with petroleum-based diesel sold in the state has been on statute books for nine years. The May 1, 2018, implementation date announced by Agriculture Commissioner Dave Frederickson and Pollution Control Agency Director John Linc Stine already comes three years later than the 2008 law originally planned.
It will apply to summer sales; a B5 mandate will remain in place during cold-weather months. The Dayton administration’s intention to keep the B20 mandate on schedule next year was well-received at Farmfest, for good reason. Soybeans, Minnesota’s second-largest crop, are the nation’s largest source of biodiesel. A soybean industry study found that the use of biodiesel had propped up the price of soybeans by an average of 63 cents per bushel between 2006 and 2015.
The move to B20 is good news for other Minnesotans, too. Biodiesel is a $1.7-billion-per-year industry in Minnesota, a recent state analysis reported, accounting for 5,400 jobs. It burns cleaner than petroleum diesel, emitting fewer airborne particulates that damage lung health. That’s why the American Lung Association’s Upper Midwest chapter vigorously backs Minnesota’s move to B20. Biodiesel is also sometimes touted as a climate-friendlier substitute for fossil fuels, since the plants used to produce it consume from the atmosphere some of the carbon dioxide that’s released when it is burned. But the biodiesel mandate has some powerful detractors, too. Representatives of the Minnesota Trucking Association, Flint Hills Resources’ Pine Bend Refinery (a Koch Industries subsidiary) and Magellan Midstream Partners L.P., an Oklahoma-based petroleum transport and storage company, recently told the Star Tribune Editorial Board that Minnesota lacks the fuel-blending infrastructure to make a B20 mandate workable.
They warned of higher costs and a disruption to fuel supplies, and said they will ask the 2018 Legislature for a delay and/or financial help with the transition. If those complaints sound familiar, it’s because they are much the same arguments raised from the same quarter when Minnesota’s biodiesel requirement went from 2 percent in 2005 to 5 percent in 2009 and 10 percent in 2013 — and, for that matter, when adding ethanol to gasoline was first proposed in the state 30 years ago. The petroleum industry has long resisted Minnesota’s efforts to be a national leader in biofuel use.
The mandate schedule was enacted in 2008 in part to give the petroleum industry ample time to prepare for new blending requirements. Magellan’s admission that none of its six Minnesota distribution terminals is ready for B20 suggests that the company’s strategy has been to drag its feet and argue that the mandate is bad policy. If lawmakers grant Magellan’s request for delay on that basis, they would be setting a precedent for an indefinite delay and send the message that similar state directives in the future can be ignored at will.
The trucking association was among a group of B20 critics who took their resistance to Minnesota’s mandate to federal court. Last October, Chief U.S. District Judge John Tunheim ruled against the critics’ argument that federal law pre-empts Minnesota’s mandate. Frederickson, the ag commissioner, said last week that the Dayton administration is ready to defend the mandate again in court if necessary.
Frederickson noted that the policy decision to make Minnesota the first state in the nation to require a biodiesel blend has deep bipartisan roots. The first biodiesel law was passed in 2002 by a divided Legislature and signed by Independence Party Gov. Jesse Ventura. The ramp-up from B2 to B20 was enacted by a DFL Legislature and signed into law by Republican Gov. Tim Pawlenty. Opponents of the mandate might think that Minnesota politics have changed since 2008 and that a new governor in 2019 might be more in tune with their objections. To that, we’d observe that replacing diesel with biodiesel is one of the few policy goals that unites both environmentally conscious voters in the metro area and agricultural interests in greater Minnesota. That’s a potent urban-rural coalition that ought to be more than a match for the fossil-fuel industry at the Minnesota Legislature.