Currently, outside markets, specifically in Europe or the United States, are more attractive because they have regulations in place encouraging the use of second-generation, low-carbon fuel, or the products of green chemistry. It is more advantageous for Enerkem to sell its products in California or in Europe, because the regulations there are reasonable and encourage the choice of green chemistry, also called circular chemistry.
Canada will have to create the market conditions needed for projects to be undertaken and biofuels to be used. Otherwise, Canada will not be able to take full advantage of the greenhouse gas reductions associated with the use of biofuels, or of green chemistry.
The Clean Fuel Standard, which is in the process of being developed, could lead to a regulatory framework that would encourage the availability and use of biofuels in Canada. But, in our view, that framework must absolutely include lifecycle analysis. Diverting all the waste from landfill sites must be recognized with credits. There must also be an established percentage of circular or biological components. In addition, renewable hydrogen and renewable electricity must be recognized as having a carbon intensity of zero in order to ensure that production in Canada can increase. This has already been done in California.
In our view, producers of low-carbon fuel must be allowed to buy renewable energy off-site in order to reduce their carbon footprint. The process is known as “book and claim”.
Lastly, credits must be awarded for diverting residual forest biomass—meaning bark and other left-overs—and reducing final uses that generate more greenhouse gases, such as burning fallen timber.