By George Orwel
Telvent DTN Refined Fuels Reporter

NEW YORK (DTN) -- Canada's Renewable Fuels Regulations will include a provision requiring a 2 percent biodiesel blend ratio in diesel fuel and heating oil, according to Environment Canada, the country's primary regulator for its biofuels mandate.

However, EC spokesman Mark Johnson said details about the biodiesel mandate including the final decision on when it should go into effect are subject to an ongoing technical feasibility study.

The feasibility study is being conducted by the Canadian Ministry of Natural Resources, and its results are expected to be released this fall, Johnson added.

"It is important to ensure the technical feasibility of renewable diesel use, under a range of Canadian conditions, prior to implementing this requirement," Johnson said in an email to Telvent DTN. "The 2 percent requirement will be set through a future amendment to the Renewable Fuels Regulations."

The final Renewable Fuels Regulations are due to be published in September and will also include requirement for a 5 percent ethanol blend ratio mandate in gasoline or E5. The biodiesel amendment can be accomplished by Prime Minister Stephen Harper's Cabinet without returning to the Canadian parliament for approval, said Johnson.

Initial reports suggested the 2 percent biodiesel mandate would go into effect in 2011.

Canada has six biodiesel plants producing a total of 109 million liters or 28.8 million gallons of biodiesel a year. Five other plants under construction will add 327 million liters or 86.3 million gallons of annual biodiesel production, bringing the total to 436 million liters or 115 million gallons, according to the Canadian Renewable Fuels Association.

CRFA said Canada will need about 500 million liters, or 132 million gallons, of biodiesel a year to meet the 2 percent mandate, with existing and proposed production capacity currently short of that goal.

The proposed federal regulations are a key initiative in support of the Canadian government's commitment to reducing the country's total greenhouse gas emissions by 17 percent from 2005 levels by 2020.

George Orwel can be reached at george.orwel@telventdtn.com

(BM/AG)

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