Unifor is urging federal and provincial officials to introduce a domestic bio-based content requirement for diesel fuel as a regulatory solution to countering foreign subsidies.The proposal from Canada’s largest private sector union, which has 15,000 members working in the energy sector, comes as Ontario-based bio-diesel producer Biox closed its doors. The company sent termination notices to Unifor Local 593 members on July 24, signalling the full closure of its Hamilton refinery, which hasn’t produced biodiesel for more than a year. The facility was created in 2007 with significant federal grants, public research funds, university commercialization infrastructure, and private investment.Unifor blames the closure on government long-term planning failures and foreign subsidies on biodiesel. Ontario currently exports feedstock to American refineries and then imports it as biodiesel, which is heavily subsidized by the U.S. and other governments. A glut of imported biodiesel has hurt Ontario producers.Biodiesel recommendationsTo revive the Canadian biodiesel industry and salvage infrastructure, Unifor recommends that Ontario mimic British Columbia’s model, which requires biodiesel to contain a minimum amount of domestically produced content. Earlier this year, the government of British Columbia took action to protect its domestic biofuel producers from the “injurious” effects of U.S. subsidies and market dumping. B.C. amended the Low Carbon Fuels Act.The B.C. Low Carbon Fuel Standard (LCFS) is a regulation with two mandates:It requires fuel suppliers to meet minimum renewable fuel blending volumes.It requires fuel supplies to progressively reduce the overall lifecycle carbon intensity (CI) of the fuel they sell.LCFS also operates with a credit market where those suppliers with a CI above target generate deficits must offset by purchasing credits from others operating in the B.C. market.The changes came about because of B.C. producers such as Tidewater Renewables warned they were facing insolvency due to a flood of cheaper, subsidized renewable diesel from the United States.“Actively building our industrial capacity is essential to future-proofing the economy from the whims of foreign leaders,” said Unifor national president Lana Payne. “The provincial and federal governments must work in tandem to connect our energy industry to industrial strategies and grow good jobs here in Canada.”Unifor is recommending that the government close loopholes by mandating a portion of provincial diesel be supported with made-in-Ontario biodiesel, and that it prioritizes physical blending over the purchase of credits. Currently, Ontario’s Cleaner Transportation Fuels regulation mandates a four percent renewable content in diesel fuel. The current compliance credit market does not differentiate based on the origin of the credit. A fuel supplier in Ontario can satisfy its provincial mandate by purchasing a compliance credit from a subsidized foreign producer, allowing compliance through that cheaper imported product.The union also wants provincial production targets and a made-in-Ontario production incentive to support new capital investments. Finally, it suggests the creation of a fund to support building a circular economy for biofuels, with the goal of building the infrastructure needed to collect and refine Ontario’s organic waste into high-quality biodiesel. Proper government planning would identify and connect feedstock sources (municipal green bins, food processors, farms, restaurants) with end-users (biofuel refineries), allowing for logistics planning and the creation of efficient, intra-provincial supply chains that reduce transportation costs and emissions.“Ontario’s biodiesel crisis is just the latest example of an energy sector lacking vision to serve Canadian consumers and industries,” said Unifor Ontario regional director Samia Hashi. “Stronger domestic energy supply chains must be at the centre of any ‘Elbows Up’ strategy.” (ICE TORONTO)

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