COP27: Where Urgency, Realism and Ethanol Can Meet

The dualities of climate are hard. But rather than exist as opposites, they can work together. At COP27 and beyond, regulators should reach for the possible while leaning into the practical.
By Andrea Kent | October 19, 2022

Balancing between anxiety and optimism is especially difficult in climate policy, and a theme that will likely define November’s COP27 meeting. There is a compelling stage for this UN Climate Change Conference (COP27) in Sharm El-Sheikh, Egypt; a plot which (to borrow from Dickens) is the best and worst of times.

The good news is that recent landmark climate policies in North America are ushering in a new era. Canada finalized its national Clean Fuel Regulations, and the U.S. Inflation Reduction Act was passed in September. It's a level of climate ambition not seen since the Paris Climate Accord was signed. The bad news is that this comes when the world is facing natural disasters, ongoing geopolitical conflict, market uncertainty and record-setting inflation following the global pandemic. It’s a daunting duality, and navigating a way forward requires understanding speed and scale. Two things that biofuels producers know well.

Making Fuel Cleaner, Now
Time is of the essence. On this, the world’s foremost scientists and economists agree. Canada, the United States and a growing list of countries are committing to net-zero greenhouse gas (GHG) emissions by 2050. Moreover, to limit average global temperature increase to 1.5ºC we need to quickly cut GHG emissions 45 percent from 2010 levels by 2030. Hitting these targets is vital as greenhouse gases do not disappear quickly, and the longer we wait, the worse climate change becomes.

Fortunately, ethanol gives the world an immediate solution. Ethanol is unique: it works in existing vehicles, uses current infrastructure and is affordable. This combination is rare today and crucial to reaching a 45 percent reduction by 2030. Importantly, it is also a central pillar of the Canadian CFR.
Canada’s CFR requires GHG reductions on a lifecycle basis, accounting for emissions from production to end use, and establishes a credit market. The Analysis from Environment and Climate Change Canada expects an average of 15 percent ethanol blends in Canada by 2030.

Making Tomorrow’s Clean Fuels for Land, Sea and Air
Building a net zero world by 2050 means leveraging everything we can today. For example, North America’s ethanol has a reliable base of production that has been doing the heavy lifting on environmental progress for decades, while continuing to adopt new technologies efficiently and for the long term. This proven capacity creates a natural synergy with the new U.S. IRA.

The IRA provides a bounty of infrastructure investments and tax credits. From a regulatory perspective, it is a model for widescale decarbonization without a federal carbon price. For the biofuels industry, this will unleash opportunities in carbon sequestration and utilization and stimulate further production of low-carbon fuels, including both sustainable aviation fuel and for the growing low carbon marine fuels sector.

The dualities of climate are hard. But rather than exist as opposites, they can work together. At COP27 and beyond, regulators should reach for the possible while leaning into the practical. This requires balancing policies that limit the worst emissions with programs that reward the best innovations. After all, the low-carbon fuel producers of today can also lead the way in making the net-zero fuels of tomorrow, and North America’s biofuels industry is leading the charge.

Author: Andrea Kent
Board Member and Past President
Renewable Industries Canada
Vice President of Industry and Government Affairs
Greenfield Global Inc.
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