World Grain - June 2007 - 56

FEATURE: SPECIAL REPORT: CANOLA-BASED BIODIESEL

Canola Council of Canada, refers to this
possibility as "double dipping" by U.S.
biodiesel plants.
Bjornson told World Grain that growers north of the border are concerned
that Canada has fallen far behind in promoting biofuels as a viable alternative to
petroleum and are relieved that Ottawa
has finally taken steps to encourage investment in the industry.
"The main mechanism that has driven
investment in biodiesel in the United
States is their $1-per-gallon blender's
tax credit. That tax credit translates into
about 30 cents per liter here in Canada,"
he said.
"There's a big disparity in how the tax
environment treats biofuels in Canada
compared to what has been offered in the
United States. So, investments - rightfully so - have been made in the U.S."
Bjornson is optimistic, however, that
Ottawa's most recent budget, which put

in place a production incentive of up to
20¢ per liter, will help to kick-start the
industry.

"There's a big disparity in
how the tax environment
treats biofuels in Canada compared to what has been offered in the United States."
Tyler Bjornson,
Canola Council of Canada

"This takes us quite a ways toward
parity with the U.S. blender's tax credit," he said. "And various provinces
have topped that up to give us parity. In
particular, Alberta has an up-to-14-cent
biofuels production incentive."
Bjornson said there's tremendous in-

DEMAN
DEMAND '

terest in biodiesel, ranging from the typical agribusiness that has biofuels production facilities globally, to farmer-led
groups interested in building a biodiesel
facility, to investors that are new to the
industry and are prepared to invest new
money in it.
"They're just waiting for the policy
environment to get sorted out so they
can start constructing," he said.
NEW BIODIESEL FACILITIES
As of mid-May, there were five major
biodiesel production facilities in Canada
that were either on the drawing board or
going into production that would use
canola as a feedstock. They are:
* Dominion Energy - Located
near Innisfail, Alberta, the C$400-million biodiesel and ethanol refinery will
include a canola crushing plant and
ethanol facility. The plant is designed
to produce 374 million liters per year of

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World Grain - June 2007

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