Biofuels (Renewable Fuels)
The government's comprehensive strategy for renewable fuels has four components:
Increasing the retail availability of renewable fuels through regulation
Regulations under development by Environment Canada will require 5% renewable content based on the gasoline pool by 2010 and 2% renewable content in diesel and heating oil by 2012, upon successful demonstration of renewable diesel fuel use under the range of Canadian conditions. The announcement was made in December 2006 and Environment Canada issued a Notice of Intent (see page 4526) in the Canada Gazette later that month.
These new regulations will require enough renewable fuel to reduce greenhouse gas (GHG) emissions by about 4 megatonnes per year, the GHG equivalent of taking almost one million vehicles from the road.
Supporting the expansion of Canadian production of renewable fuels
On July 5, 2007, Prime Minister Stephen Harper announced the ecoENERGY for Biofuels Initiative, which will invest up to $1.5 billion over 9 years to boost Canada's production of renewable fuels such as ethanol and biodiesel.
The initiative will provide operating incentives to producers of renewable alternatives to gasoline and diesel based on production levels and other factors. It will make investment in production facilities more attractive by partially offsetting the risk associated with fluctuating feedstock and fuel prices.
Budget 2007 also states that concurrent with the implementation of the operating incentive program to promote additional domestic production of renewable fuels, the current fuel excise tax exemptions for ethanol and biodiesel will be eliminated as of April 1, 2008.
On April 23, 2007, the Minister of Agriculture and Agri-Foods officially launched the ecoAGRICULTURE Biofuels Capital Initiative (ecoABC) a new $200 million initiative that will provide repayable contributions of up to $25 million per project to help farmers overcome the challenges of raising the capital necessary for the construction or expansion of biofuel production facilities.
In March 2007, the Minister of Agriculture announced a $10 million expansion to the Biofuels Opportunities for Producers Initiative, which helps agricultural producers develop sound business proposals, as well as undertake feasibility or other studies to expand biofuels production capacity.
Accelerating the commercialization of new technologies
Budget 2007 (see Investing in Cleaner Fuels) also makes $500 million, available over eight years to Sustainable Development Technology Canada (SDTC) to invest with the private sector in establishing large-scale facilities for the production of next-generation renewable fuels. Next-generation renewable fuels, produced from non-food feedstocks such as wheat straw, corn stover, wood residue and switchgrass, have the potential to generate even greater environmental benefits than traditional renewable fuels.
This measure complements research and development initiatives including the following:
Further Information / Related initiatives
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