National Renewable Diesel Demonstration Initiative

Overview

The National Renewable Diesel Demonstration Initiative (NRDDI) supports projects that demonstrate how renewable diesel fuel will perform under Canadian conditions in advance of the proposed renewable fuels regulation that would require an average annual 2% renewable content in diesel fuel and heating oil by 2011 or earlier, subject to technical feasibility. This is a part of the Government of Canada's Renewable Fuels Strategy.

Non-repayable contributions were made to approved projects designed to demonstrate cold weather operation, long-term storage, impacts on engines and equipment, and distribution of the fuel.

The NRDDI is administered by Natural Resources Canada. Natural Resources Canada contributed up to 50% of the total project costs of an approved project. Applications were accepted on a continuous basis until May 29, 2009.

The final report is available.

Background

What is renewable diesel?

For the purposes of this program, renewable diesel is defined as a diesel fuel substitute made from renewable materials such as vegetable oil, waste cooking oil, animal fat, fish oil or cellulosic feedstocks consisting of agriculture and forest biomass. Biodiesel is one common example of a renewable diesel.

Why is the Government of Canada supporting renewable diesel?

The Government of Canada is committed to expanding the production and use of a range of cleaner, renewable biofuels, including renewable diesel. The intent is to reduce greenhouse gas emissions resulting from fuel use, encourage greater production of biofuels, accelerate the commercialization of new biofuel technologies, and provide new market opportunities for agricultural producers and rural communities.

Analysis performed at Natural Resources Canada using the GHGenius model estimates that, under typical Canadian conditions, vegetable oil-based biodiesel production and use can reduce life cycle fossil energy use by around 80% and life cycle GHG emissions by more than 60% compared to crude oil-based diesel. Renewable diesel can also reduce tail-pipe emissions of some air pollutants compared to petroleum diesel.

Why are demonstration projects needed?

In December 2006 the Government announced its intention to develop a regulation requiring an average annual 2% renewable fuel content in diesel fuel and heating oil, upon successful demonstration of renewable diesel fuel use under the range of Canadian conditions.

Renewable diesel has been tested in a variety of vehicle engines under driving conditions in many parts of Europe and the United States. Renewable diesel has also been tested in certain applications in Canada, such as trucks, buses and marine vessels.

During consultation, Canadian industry sectors and end-users have raised questions related to large-scale integration of renewable diesel into fuel distribution networks. The National Renewable Diesel Demonstration Initiative aims to address these remaining questions in advance of the proposed regulation coming into effect.

Objective of the Program

The objective of the National Renewable Diesel Demonstration Initiative (NRDDI) is to address industry and end-user questions about renewable diesel use by demonstrating how it will perform under Canadian conditions.

Among the questions that have been raised are:

impacts of cold weather;
impacts of long-term storage (with or without temperature fluctuation);
interaction of renewable diesel from various feedstocks with seasonal variations of ultra-low sulphur diesel (ULSD);
impacts on emerging heavy truck engine technology (in particular 2007 and 2010 emission controls);
impacts on engine and heating systems components;
distribution infrastructure.

These questions will be addressed by providing non-repayable contributions to approved projects that demonstrate aspects of renewable diesel use and/or distribution in Canada. Funded projects may demonstrate one or more of the following:

the use of various blend levels;
the use of fuels produced from various feedstocks;
the use of renewable diesel in various applications that diesel fuel is likely to encounter in Canada;
the infrastructure for renewable diesel storage and distribution.

Funding will be available to facilitate demonstration projects of different scales in both the on-road transportation and off-road sectors.

Executive Summary

PDF Version: National Renewable Diesel Demonstration Initiative Infrastructure Project – Final Report (PDF, 971 KB)

In 2006, the Canadian government proposed Regulations under the Canadian Environmental Protection Act that, amongst other requirements, would mandate the requirement for an average of two percent renewable content in the diesel and heating oil pool by 2012 upon successful demonstration. In April 2010, the federal government indicated that no fixed timeline would now be associated with the two percent regulation and that "this requirement would only be brought into force once the technical feasibility of renewable diesel fuel use under a range of Canadian conditions has been demonstrated" (Environment Canada, 2010).

In this context, the Canadian government requires a study that addresses the necessary infrastructure, capital and other costs and time frame required for the implementation of a 2% national renewable diesel mandate across Canada under the conditions prescribed by the proposed Regulations. The principal objective of this project is to assess these issues. More specifically, this mandate involves the following tasks: assessment of the existing blending, storage and distribution infrastructure for renewable content in diesel and heating oil in place on January 1^st 2010; assessment of what infrastructure remains to be installed in order for regulated parties to comply with the regulations, as well as the estimated costs and lead times of these new investments; estimation of incremental renewable diesel (biodiesel, hydrotreated vegetable oil (HVO), etc.) and kerosene requirements to meet fuel specifications, based on projected regional blending schedules; and an evaluation of the industry's ability to ensure that distillate pools with biocontent can be kept separate from those without.

The results of these Tasks were obtained by carrying out a literature review and also through extensive consultation with industry proponents. The majority of the large petroleum producers in Canada agreed to participate in this study. In order to preserve the confidentiality of the commercially sensitive information provided by the petroleum producers, for the purposes of this report the results have been aggregated by region. The region defined as "West" includes British Columbia, Alberta, Saskatchewan and Manitoba. There is a central region that includes only the province of Ontario and is therefore referred to simply as "Ontario" throughout the text. The region defined as "East" includes Quebec and the Atlantic provinces.

Existing and necessary additional infrastructure for the storage, blending and distribution of renewable content in diesel and heating oil and their lead times

Biofuel distribution in Canada is not achieved by the same means as fossil fuels; infrastructure must be modified for the transportation and distribution of first generation biofuels. Since the biodiesel industry is still at an embryonic phase and its development is fast, the best practices are not always used for the different distribution activities: transportation is currently done mostly by truck or rail, storage is primarily done by petroleum producers, especially for pure biodiesel for which there are no primary terminals, and blending is done largely through splash blending due to lack of infrastructure. Quebec is an exception with 65% to 75% of the blending is done by in-line injection directly at terminals.

Below we provide a description of the existing and additional necessary renewable diesel infrastructure that could realistically be put in place by a series of milestone dates. First we present the infrastructure that is already in place and then we describe the projects that are currently underway and their estimated completion dates. Finally, we describe the new projects that are awaiting regulatory certainty to be started and the estimated length of time required for these infrastructure additions/modifications. It should be noted that in most cases, new infrastructure will only be made operational during the Spring or Summer. This is to avoid beginning operations during the winter months, which can be more problematic due to cloud point issues. Therefore, if regulatory certainty is attained in December and a project takes a year to complete, it will still not be made operational until at least April of the following year. This important point should be taken into account when analysing lead times for new infrastructure.

The lead times for the upgrade of a terminal or refinery site are approximately one to three years. Longer lead times are usually associated with larger investments, such as truck, rail and/or marine receipt facilities. Permitting and planning are typically the most time-intensive steps in the process, totalling 9 to 18 months. The planning stage is the most unpredictable at this point, as many respondents are waiting for regulatory certainty to begin their planning in earnest. Respondents noted that accelerating lead times in order to meet a mandated regulatory start date, although possible in some cases, can lead to significant cost overruns due to plans and permitting being rushed. The lead times for sales site (commercial and retail) upgrades are very short, three to six months, since the types of modifications are minor (tank cleaning, new filters, inspections).

Existing infrastructure as of January 2010

Investments in new renewable diesel infrastructure have been made at two refineries in the West: at the Consumer's Co-op Refineries Ltd. (CCRL) refinery in Regina, Saskatchewan and the Chevron refinery-terminal in Burnaby, British Columbia. In addition, ten terminals had received modifications or upgrades to accommodate biodiesel. Seven out of the ten terminals are located in the West and are operated by Imperial Oil, Shell and Suncor. The investments in the West were made in order to meet provincial regulations in Manitoba and British Columbia and in anticipation of regulations in Alberta and Saskatchewan. Three of the ten upgraded terminals are located in the East, are operated by Norcan and Canterm (under the ownership of Olco) in Montreal and Québec City, and are not due to any federal or provincial regulations.

All of the investments have been related to the storage and blending of biodiesel, at the refinery or terminal, such as the installation of new B100 receipt tanks and/or modification of existing tanks (cleaning, treating and installation of filters, usually one tank per site), temperature control equipment (heating and insulation), blending equipment (in-line or at the rack), modification of blending electronics and billing systems and customer education. Three sites received truck offload facilities and two sites received rail and marine offload facilities, respectively.

A total of approximately 200 sales sites (commercial and retail) had already been upgraded in order to accommodate biodiesel blends. The majority of these sites are in the East, due to Quebec already having a market for biodiesel blends, and are operated by independents. The remaining sites are in the West (no sites in Ontario). The investments in the West were put in place in order to meet the provincial regulations, whereas those in the East were not.

Projects currently underway

New infrastructure projects that are currently underway are described below and listed according to their expected completion dates. In order to preserve the confidentiality of the data provided by the respondents, refinery and terminal infrastructure additions are described together. It should be noted that all projects that are currently underway are located in the West and have been put in place in order to meet existing provincial regulations.

January 2011 – It is predicted that three refinery and/or terminal upgrades in the West only could be put in place by January 2011 (although it should be noted that actual biodiesel blending would not likely occur before early April, due to cold temperatures). These infrastructure additions include truck receipt facilities for biodiesel at two sites, rail receipt facilities at one site, new tanks and lines with heating, facilities for rack blending directly into truck and rail, as well as in-line blending facilities.

June 2011 – By this date, it is estimated that in addition to the infrastructure described above, additional infrastructure at one refinery/terminal could be operational. This site upgrade would include heated storage tanks and a heated in-line blending system, as well as truck offload facilities.

December 2011 – No additional infrastructure is anticipated for this date.

June 2012 – One additional site infrastructure upgrade could be completed by this date. It will include heated storage tanks and a heated in-line blending system, as well as truck offload facilities.

Approximately 230 additional sales sites have been upgraded to accommodate biodiesel blends since January 2010.

Projects awaiting regulatory certainty

The majority of new infrastructure projects that would be put in place in order to meet the proposed federal regulations are awaiting regulatory certainty to be put into action. These projects are described below and listed by their estimated required lead times from regulatory certainty. In order to preserve the confidentiality of the data provided by the respondents, refinery and terminal infrastructure additions are described together.

6 months – None of the planned additional infrastructure could be in place by this time.

12 months – One proposed project in the East could be completed by this time. The project involves the installation of heated storage tanks and a heated in-line blending system at a refinery or terminal site.

18 months – No additional planned infrastructure modifications could be in place by this time.

24 months – It is estimated that the majority (10 sites) of large-scale infrastructure additions could be in place by this time. In addition to the one site in the East completed at 12 months, it is expected that two refinery and/or terminal sites could be upgraded in the West, four in Ontario and three in the East. One site will invest in pipeline testing and pipeline protocol changes in order to possibly transport B5 by pipeline. Two sites will receive marine receipt and piping facilities, one site will receive rail receipt facilities and three sites will receive truck receipt facilities. Three sites will receive rack blending facilities and one site will receive equipment for batch blending of ultra low-sulfur kerosene (ULSK) with seasonal diesel. Most sites will also include heated tanks and lines as well as upgrades to blending electronics.

30+ months – For this date, in addition to the infrastructure put in place by 24 months, it is estimated that the remaining six sites comprised of one refinery and/or terminal site upgrade would be completed in the West, two in Ontario and three in the East. All six sites will receive rail receipt facilities and five will also receive truck receipt facilities. Five sites will install rack blending equipment; two will install in-line blending equipment. All sites will either install new tanks and/or clean existing tanks, as well as tank and line heating systems.

It is estimated that approximately 1500 additional sales sites (commercial and retail) will need to be converted in order to meet the federal regulations.

Biodiesel and kerosene requirements

The situation in the West is unique because of existing provincial mandates. The marginal volumes of biodiesel being blended in order to meet the proposed federal requirements are relatively low (notably because the regional producers/blenders in the West would already be meeting the proposed federal requirement via their blending for provincial regulations). National refiner/marketers operating in this region will choose to blend in high concentrations (B5) only during the warmer months, mostly April to September, in order to help them meet their national 2% average. Therefore kerosene is required only during the season transition months of March, April, May and August, September, October.

The situation is quite different in Ontario and the East. Since there are no existing or planned provincial regulations for renewable content in diesel/heating oil in these regions, the volumes of biodiesel that will need to be blended in order to meet the federal mandate will be higher. Due to the regional nature of their operations, regional producers/blenders will have less flexibility in terms of where and when they blend with biodiesel. Therefore, in this region, there are significant volumes of biodiesel that will be blended during the winter months, which requires large volumes of kerosene. Nevertheless, in all regions blenders will seek to minimize biodiesel blending during the colder months.

Costs of infrastructure additions/upgrades and additional kerosene

The costs for the upgrade of one refinery or terminal site range from $0.5 million to $16.3 million, the average being around $7.5 million. The costs depend largely on the extent of the infrastructure additions. Sites that require marine and/or rail offloading infrastructure for biodiesel had the highest costs, usually in the $7 million to $16 million range. Truck offloading equipment, new tanks, equipment for heating and inline or blending at the rack are all also significant expenses, ranging from $1 million to $7 million.

Table 1 presents the total infrastructure additions and their costs, by region:

TABLE 1 – NUMBER OF REFINERY AND/OR TERMINAL SITES RECEIVING NEW INFRASTRUCTURE ADDITIONS AND/OR UPGRADES AND THEIR COSTS

Existing Investments

Additional Investments		Total
	Number of sites	Total Cost ($ million)	Number of sites	Total Cost ($ million)	Number of sites	Total Cost ($ million)
West	9	20.0	8	48.3	17	68.3
Ontario	0	n/a	6	42.6	6	42.6
East	3	1.7	7	68.0	10	69.7
Total Canada	12	21.7	21	158.9	33	180.6

The cost of upgrading a retail site is very low, from $400 – $2000 on average. However, the number of retail sites that are expected to be upgraded is high, approximately 1500. Based on estimates from the respondents, it is expected that a total of $1.8 million will need to be spent on upgrading retail sites across the country in order to sell biodiesel blends due to the proposed federal regulations.

Table 2 presents the marginal annual costs of blending with kerosene in order to meet cloud point requirements. For the purposes of this calculation we have used a price differential of 4.9 CAN cents/litre between kerosene and conventional diesel. This is based on the average historic differential in wholesale prices for kerosene and No. 2 distillate during winter months (October to March) for the last three years (2007 – 2010) (EIA, 2010). The table is based on projected 2013 demand for diesel in Canada as it can be assumed that all blending infrastructure would be in place at that time.

TABLE 2 – ANNUAL COSTS OF ADDITIONAL KEROSENE

Provincial mandates only

Federal mandate only		Total
	Volume* (m³)	Cost (million $)	Volume* (m³)	Cost (million $)	Volume* (m³)	Cost (million $)
West	123,865	6.07	55,704	2.73	179,570	8.80
Ontario + East	10,723	0.53	472,277	23.14	483,000	23.67
Total Canada	134,588	6.59	527,981	25.87	662,569	32.47

*Based on 2013 demand.

In some cases producers and blenders will be using HVO instead of biodiesel in order to meet the federal and provincial requirements (primarily because HVO has superior cold flow properties). This is mainly due to the fact that in some regions, companies will have to blend biocontent during the winter months to adhere to provincial regulations especially in BC, for the 5% provincial regulation. The use of HVO would also result in savings in avoided ULSK purchases as well as by reducing the need for specialized infrastructure to store and blend it.

However, HVO is currently very expensive relative to biodiesel. The price differential will vary according to changes in feedstock prices but is currently in the range of about 0.3 – 0.4 $/L. Therefore, for the provincial regulations only in the West, it is expected that about $18 – $21 million will be spent annually on HVO, based on 2013 demand (no HVO is intended to be used in Ontario and the East in the absence of federal regulations). The incremental annual costs of HVO for the federal regulations only is expected to be approximately $9 – $12 million in the West and $1.8 – $2.4 million in Ontario and the East. A significant portion of these costs are related to transportation, since for the moment and in the near future the product is only available in Singapore and Europe. It should be noted that some respondents indicated that they are considering plans to install facilities to produce this product themselves.

Eligibility and Selection

Eligible Applicants

Eligible applicants include:

Canadian for-profit organizations;
Canadian not-for-profit organizations;
Canadian industry associations;
Canadian research organizations;
Canadian universities.

Selection Criteria

In order to be eligible for funding, a project must:

take place in Canada;
address Canadian stakeholders' questions regarding renewable diesel use; and
include multi-stakeholder steering and technical committees in the development, implementation and reporting stages of the project.

Applicants must also demonstrate that:

proposed work builds upon existing experience/knowledge;
stakeholders will have access to the data produced from the project;
recognized, standardized and scientifically sound methods/methodologies will be used under the direction of appropriately qualified technical professionals;
fuels used conform to the most recent industry-wide quality specifications;
results will be communicated in a scientifically sound manner; and
the project can be completed by June, 2010.

To apply

To apply for a contribution from the National Renewable Diesel Demonstration Initiative (NRDDI), eligible applicants should submit a written proposal, including a statement of work outlining proposed project activities. Applications will be accepted on a continuous basis until May 29, 2009.

Proposals should be sent to:

Natural Resources Canada
Fuels Policy and Programs
580 Booth Street, 18^th Floor, Room C9-4
Ottawa, Ontario K1A 0E4
Attention: NRDDI Program Manager

Proposals should include:

Background information about the applicant organization (articles of incorporation for corporations, letters patent for non-profit organizations, governance structure, size, years in existence, etc.);
Background information about the project;
Purpose and objectives of the project;
Project location(s);
Methodology or approach, including how the project builds upon existing experience and knowledge;
Project timelines and milestones to ensure project completion by June, 2010;
Benefits to stakeholders groups;
Expected results/outcomes;
Expected outputs;
Identification of how the project aligns with the program objective and meets selection criteria;
Identification of the lead organization and other collaborators, governments, organizations or agencies participating in the project and the expertise that each will bring to the project;
A method of measuring performance, including performance objectives and performance indicators; in particular, identification of how the project will ensure:
- Canadian stakeholders' concerns have been addressed, including participation of stakeholders on steering and technical committees (provide proposed membership),
- access to project data by all stakeholders,
- use of recognized, standardized and scientifically sound methods/methodologies under the direction of appropriately qualified technical professionals, and
- use of fuels that conform to the most recent industry-wide quality specifications.
A plan for communicating results in a scientifically sound manner;
A financial plan (budget), including identification of all sources of funding (both direct and in-kind contributions);
Necessary information to allow for assessment of the proposed project's environmental impact as per the requirements of the Canadian Environmental Assessment Act and, where appropriate, harmonized with other applicable environmental assessment legislation; for further information on this requirement, please contact the Program;
Disclosure of the involvement of former public servants for whom the Conflict of Interest and Post-Employment Code for Public Office Holders or the Values and Ethics Code for the Public Service apply, to ensure that no such individual derives a direct benefit from any contribution agreement under this program, unless that individual is in compliance with applicable post-employment provisions;
Where lobbyists are utilized, assurance that the lobbyists are registered in accordance with the Lobbyist Registration Act, that no actual or potential conflict of interest exists, and that the recipient organization does not pay lobbyists on a contingency fee basis.

Disclaimer: this request for proposals should not be misconstrued as an indication that the financial assistance is imminent. Until a written contribution agreement is signed by both parties, no commitment or obligation exists on the part of Natural Resources Canada to make a financial contribution to your organization's proposed project including any costs incurred or paid prior to the signing date of the contribution agreement.

Proposal review

All proposals will be reviewed and assessed by a review team consisting of at least one representative from Natural Resources Canada and from Environment Canada (the department responsible for developing the renewable fuel regulation). The review team will draw upon the advice of industry and government experts as required to assess the proposals. A letter will be sent to applicants advising of the results of the assessment.

A contribution agreement will be negotiated with applicants who meet the program criteria and are selected to receive a contribution from the NRDDI.

Funding

Contributions under the National Renewable Diesel Demonstration Initiative will be made only to applicants who have signed a contribution agreement with Natural Resources Canada.

The contribution agreement will clearly identify the portion of total project costs that NRCan will reimburse to an eligible recipient accepted under the program.

Natural Resources Canada can contribute up to 50% of the total project costs of an approved project up to a maximum of $1,000,000 per fiscal year. Total government assistance (federal, provincial/territorial and municipal governments) for a funded project cannot exceed 75% of total project costs.

The program is open to applicants, subject to funding availability, until May 29, 2009. Please be advised that until a written contribution agreement is signed by both parties, no commitment or obligation exists on the part of Natural Resources Canada to make a financial contribution to your organization's proposed project including any costs incurred or paid prior to the signing date of the contribution agreement.

What costs are eligible for reimbursement?

Eligible costs will be directly related to approved projects and will include:

Salaries and benefits;
Overhead expenses (considered on a case-by-case basis);
Professional, scientific and contracting services;
Travel costs, including transportation, meals and accommodation;
Printing and distribution services;
Data collection services, including processing, analysis and management;
Licence fees and permits;
Field testing services;
Equipment and products, including diagnostic and testing tools and instruments;
Laboratory and field supplies and materials;
Necessary modifications to fuel storage and distribution systems to accommodate renewable diesel;
Taxes (PST, HST and GST).

Where an environmental assessment of a project is required under the Canadian Environmental Assessment Act, the Government of Canada will not make any payments to a project unless and until:

a) an environmental assessment has been carried out in accordance with the Canadian Environmental Assessment Act; and

b) the responsible authority (NRCan), pursuant to the Canadian Environmental Assessment Act, has determined that taking into account the implementation of mitigation measures, the project is not likely to cause significant adverse environmental effects.

Reporting

Recipients must provide at least the following information:

Claims for payments based on achievement of milestones outlined in the contribution agreement;
Records of discussions at multi-stakeholder steering/ technical committee meetings;
Final project report, approved by the project's multi-stakeholder steering/technical committee;
Final project financial statement; and
Environmental Assessment Report (where applicable).

Projects

The National Renewable Diesel Demonstration Initiative was launched in December 2008.

National Renewable Diesel Demonstration Initiative Approved Projects

Imperial Oil Limited

Imperial Oil Limited (IOL) is a leading member of Canada’s petroleum industry. The objective of their renewable diesel project is to address the two main areas of concern for industry and end-users: cold flow performance of the finished fuel and the stability of the fuel. IOL will conduct a variety of tests at their Sarnia Research Facility.

FPInnovations

FPInnovations is a non-profit research and development organization whose goal is to improve the effectiveness of the Canadian forestry sector. Their project will demonstrate and document the experience of using various blends of biodiesel (up to 10%) by off-road heavy equipment used to construct and pave provincial public highways, to provide material handling in a saw mill, logging road construction, and the harvesting and processing of timber in isolated locations in some of Canada’s most challenging environments. In addition, the project will examine means by which fuel supply infrastructure challenges to remote locations can be overcome and will transfer the knowledge gained over the course of this project to others in the construction and forestry sectors. The project is complete and the final report is available.

Manitoba Hydro

Manitoba Hydro is an electric power and natural gas utility in the province of Manitoba. This project will demonstrate the use of biodiesel blends (5%) under extreme cold weather conditions in electric generators in a remote Northern Manitoba community. As well, the project will investigate the impact of long-term storage on dispenser filter plugging in a vehicle fleet application and alternative measures for testing for minor impurities in the fuel and how these impurities may relate to long-term storage.

Canadian Pacific Railways

Canadian Pacific Railways will demonstrate the use of biodiesel blends (5%) in locomotive operations between Calgary and Edmonton. This project will focus on the impact of cold weather on operability, and the impact of biodiesel on direct-to-locomotive fuelling, engine components and heating systems.

The Saskatchewan Research Council

The Saskatchewan Research Council (SRC) will demonstrate the use of biodiesel blends of 5% in winter and 10% in summer in the agricultural sector. In particular, the project will investigate the impact of off-season storage of biodiesel in equipment and storage tanks on fuel quality. Harvesting equipment can be stored with fuel in the tank for a period of up to ten months with dramatic fluctuations in temperature and humidity conditions

The Prairie Agricultural Machinery Institute

The Prairie Agricultural Machinery Institute (PAMI) will assess biodiesel blends (5%) that have been stored in harvesting equipment tanks for up to ten months and biodiesel blends that have been stored for two years to determine impacts of long-term storage on fuel quality. The project is complete and the final report is available.

Royal Military College of Canada

The Royal Military College of Canada will study the kinetics of saturated monoglyceride-based particles formation to gain better knowledge for the filtration of these particles from the fuel. The laboratory will monitor sediments in the fuel against time at various temperatures as well as determine and compare the chemical composition of sediments using titration, chromatography and spectroscopy techniques. The project is complete and the final report is available.

Other NRDDI Studies

ÉcoRessources Consultants

ÉcoRessources is an environment and natural resource economics consultancy. In the context of an average 2% national renewable diesel requirement, their report takes an inventory of existing and required infrastructure for the blending and distribution of renewable fuels and provides an estimate of the necessary incremental biodiesel and petroleum blendstock, based on a literature review and through extensive consultation with industry proponents. In addition, the report presents an estimate of costs to the downstream petroleum sector and the lead times for the required upgrades to infrastructure. This project is complete and the final report is available.

Previous renewable diesel demonstrations in Canada

Frequently Asked Questions

What is an in-kind contribution?

Please consult section 8.4.3 of the Treasury Board Guide on Grants, Contributions and Other Transfer Payments.

What are the results of previous renewable diesel demonstrations in Canada?

Renewable diesel has already been tested in certain applications in Canada, such as trucks, buses and marine vessels. Results of some demonstrations can be found at /transportation/fuels/biodiesel/biodiesel-projects.cfm.

Most recently, renewable diesel was tested in 59 heavy vehicles of various sizes through the Alberta Renewable Diesel Demonstration, the largest cold-weather, on-road demonstration of the fuel undertaken in Canada. The Government of Canada and the Government of Alberta invested $1.3 million in this project, which was managed by Climate Change Central and demonstrated the quality and performance of renewable diesel in harsh Canadian weather. Following a lab testing phase, the demonstration provided real-world experience for fuel blenders, distributors and users by running the fuel in commercial trucks. The on-road demonstration phase of the project ended in October 2008, and the results are now available at http://www.renewablediesel.ca/.

Is renewable diesel already being used commercially in Canada?

Renewable diesel is being used with some vehicle fleets, but it is not yet widely commercially available at the pump in Canada, except for a few retail sites in Quebec, Ontario and British Columbia.

Why is the deadline for proposals May 29, 2009?

As part of its Renewable Fuels Strategy, the Government of Canada announced in December 2006 that a regulation will be developed requiring an average annual 2% renewable content in diesel fuel and heating oil by 2012. In advance of this regulation coming into effect, the use of renewable diesel must be successfully demonstrated in the range of Canadian conditions. Demonstration projects funded by the National Renewable Diesel Demonstration Initiative must be completed by June, 2010 in order to allow sufficient lead time for the regulation to come into effect.

Can existing renewable diesel demonstration projects apply for funding?

Demonstration projects that are already underway may qualify for funding from the National Renewable Diesel Demonstration Initiative provided they meet the selection criteria. However no costs incurred by the applicant prior to the acceptance of the project proposal should be included in the funded portion of the project.

Contact NRDDI

For more information on the NRDDI, please contact us by e-mail or by mail:

NRDDI
Natural Resources Canada
Fuels Policy and Programs
580 Booth Street, 18^th Floor, Room C9-4
Ottawa, Ontario K1A 0E4

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Date modified:: 2024-06-19