In March, Minnesota Governor Jesse Ventura permitted a new law to go into effect that requires a two percent blend of biodiesel no later than June 30, 2005. However, the requirement could take effect sooner if the state’s annual production capacity exceeds eight million gallons and 18 months have passed since the federal government enacted legislation providing a two cent per gallon incentive for diesel fuel containing two percent biodiesel. The law is feedstock neutral, allowing the blend to be produced from animal fat-based products or soy-based. Minnesota is the first agriculture state to pass a biodiesel requirement.
The legislation also makes distributors eligible for a partial refund of eligible capital expenditures necessary to comply with the mandate. If the law is repealed within two years, the reimbursement rate is 80 percent. Reimbursement is reduced by 10 percent per year until the eighth year after the law goes into effect. If the law stands for at least eight years, the reimbursement expires. The Independent Liquid Terminals Association estimates the cost of blending equipment is about $2 million per terminal.
Exempted from the mandate are motors used at nuclear generation facilities, railroad locomotives, and off-road taconite and copper mining equipment and machinery. The exemption for the motors at nuclear generating facilities expires 30 days after the federal Nuclear Regulatory Commission approves the use of biodiesel at regulated facilities.
June 2002 Render