August 2014

DME Insider Briefing

DME Insider Briefing

August 2014

A Publication for Members of the International DME Association

DME Becomes the First Biogas-Based Fuel Approved Under the U.S. Renewable
Fuel Standard
UNITED STATES | Another important step forward has
been achieved for the commercial introduction of DME as a
transportation fuel, with confirmation by the U.S.
Environmental Protection Agency ("EPA") that DME
produced from biogas and other renewable sources by IDA
member company Oberon Fuels qualifies for inclusion under
the Renewable Fuel Standard ("RFS") the first such
approval ever given for a biogas-based fuel. Oberon's
biogas-based DME is now eligible under the Clean Air Act
for high value cellulosic biofuel (D-code 3) and advanced
biofuel (D-code 5) renewable identification numbers
("RINs*") under the RFS.
This determination by the EPA marks another important
milestone in 2014 for DME's introduction as a fuel, following
on the publication in February of an ASTM specification for
DME (ASTM D7901 Standard Specification for Dimethyl
Ether for Fuel Purposes), another initiative led by executives
from Oberon Fuels. The ASTM specification provides
guidance for fuel producers, engine and component
suppliers, and infrastructure developers on DME purity,
testing, safety, and handling.

Oberon Fuels Maverick DME plant in Southern California

The EPA's analysis determined that biogas-based DME produced using the Oberon process resulted in an approximate 68% reduction
in greenhouse gases when compared to baseline diesel fuel. The determination confirms that renewable DME produced using biogas
from landfills, municipal wastewater treatment facility digesters, agricultural digesters, separated municipal solid waste (MSW)
digesters, and biogas from the cellulosic components of biomass processed in other waste digesters through the Oberon pathways
qualifies for cellulosic biofuel RINs, while renewable DME produced from biogas from waste digesters processing renewable biomass
that is assumed non-cellulosic through the Oberon pathways qualifies for advanced biofuel RINs. In July the EPA issued a ruling that
qualifies renewable biogas sourced from a number of feedstocks as advanced fuel pathways under the RFS. New pathways include
compressed and liquefied natural gas produced from landfills, municipal wastewater treatment plants, MSW and agricultural digesters.
Eligibility for RINs was also extended to electricity sourced from biogas that is used specifically to power electric vehicles.
The program for the DME 6 conference in San Diego (7 8 October) includes updates from Oberon Fuels and other companies on
commercial and technical developments connected with DME for fuel applications, and an opportunity to meet with representatives of
companies now entering the market, evaluating the opportunities, and / or looking for technology, guidance, investment, and partners.
Oberon Fuels Leads Important Industry Initiatives
The EPA determination related to the Oberon Fuels DME process is another significant achievement for the
company and its senior executives, and further validation of the technical and commercial feasibility of their
process and DME fuel applications. The ASTM specification issued in February this year had its origins in the
initiation by Oberon in 2012 of an ASTM task force focused on developing a specification for DME as a fuel. In
addition to Oberon Fuels, the ASTM DME task force involved representatives from a number of international
companies and organizations including Volvo, BP, Delphi, Marathon Petroleum, Petrobras, the National Propane
Gas Association, and the California Department of Food and Agriculture.
Oberon executives currently chair the IDAs North American Affairs Committee and participate in several others, and their successful
petition to the EPA for certification of a pathway (defined as a feedstock, fuel type, and/or fuel production process) is further
demonstration of the resources and leadership that the company is contributing to enable the successful introduction of DME as a fuel
in North America and elsewhere. The company is a sponsor of DME 6, and on 9 October will welcome a number of conference
delegates (who have registered for the optional visit) to their Maverick plant in the California desert the first DME for fuel production
facility in North America.

Patron Members
www.aboutdme.org

DME Insider Briefing

August 2014
The Renewable Fuel Standard and the Market Value of RINs Credits
The EPA is responsible for developing and implementing regulations to ensure that transportation fuel sold
in the United States contains a minimum volume of renewable fuel, and does this through the
administration of the Renewable Fuel Standard (RFS). The RFS program, introduced with laws passed in
2005 and 2007, established the first renewable fuel volume mandate in the U.S. and requires the annual
use of 36 billion gallons of renewable fuel by 2022. Under the RFS, the EPA applies lifecycle greenhouse
gas performance threshold standards to renewable fuels to ensure that each category of renewable fuel
emits fewer greenhouse gases than the petroleum fuel it replaces.
*RINS (Renewable Identification Numbers) are used to monitor and record the use of biofuels or renewable
volume obligations (RVO) for obligated parties (e.g. fuel refiners and importers) as part of the RFS. Each
RIN is a 38-character alphanumeric code assigned to each gallon of renewable fuel that is produced or
imported into the United States. RINs are valid for the year in which they are generated, however, up to 20% of a year's mandate can
be met with RINs generated in the previous year. Once the renewable fuel has been blended into gasoline or diesel fuel or sold to
consumers in neat form, the RIN representing the renewable attribute of the fuel becomes separated from the physical biofuel and can
be used for either compliance purposes or traded. Separated RINs have a market value attached to them and provide flexibility for
obligated parties in meeting their RVOs.

DME Represented at White House Meeting

UNITED STATES | Oberon Fuels President Rebecca Boudreaux met
with White House Domestic Policy Council and Senior Advisor to the
President John Podesta last month to discuss concerns about the U.S.
Environmental Protection Agency's approval process for new biofuels,
and the new Renewable Volume Obligation requirements being
introduced.
Both Oberon Fuels and DME's introduction as a fuel in North America
were discussed at the meeting. Boudreaux participated in the meeting
as part of a delegation of seven industry members with the Advanced
Biofuels Association (ABFA) to encourage the White House, among
several matters, to speed up approvals of new fuels that can qualify as
advanced and cellulosic fuels, suggesting that the EPA expedite the
manner in which they approve pathways for feedstocks, fuels, and
technologies.

Meeting with senior White House officials took place in the Eisenhower
Executive Office Building

More than 30 applications for new biofuel sources are pending at the
EPA, with an average wait time of two years. The delays keep fuels off the
market because prospective buyers cannot get credit under the biofuel mandate
to purchase them.

Upcoming Events
th

6 International DME Conference

7 9 October 2014
Hilton San Diego Bayfront
San Diego, California
NOTE: DME 6 room block deadline is 5 September
Event website

EFI Gas-to-Market Forum & Site Visits

21 23 October 2014
Omni William Penn Hotel
Pittsburgh, Pennsylvania
Event website
th

17 IMPCA Asian Methanol Conference

4 6 November 2014
Regent Hotel
Singapore
Event website

Patron Members
www.aboutdme.org