Friday, March 25, 2011

$26 million CAD biodiesel incentive program introduced in Saskatchewan

A 5 year $26 million CAD provincial incentive program for renewable diesel production in Saskatchewan will commence in April 1, 2011. Biodiesel developers should take note that a mandatory minimum renewable fuel requirement for diesel fuel in Saskatchewan will follow 15 months later.

The program will provide a grant of 13 cents CAD per litre to eligible producers of renewable diesel. The renewable diesel must be manufactured from renewable materials such as off-grade canola and farm and forest biomass.

The program is to begin April 1, 2011 and will wind up in 2016. Saskatchewan's 2 percent renewable diesel mandate is scheduled to commence on July 1, 2012.

SaskCanola, the province's farmer-led canola development commission, hailed the grant program and mandate as recognizing "the significant importance of a growing Saskatchewan biofuel industry in which canola can be the leader," chairman Brett Halstead said in a separate release.

The federal Canadian government's 2 percent renewable content mandate for diesel and heating oil is expected to take effect July 1, 2011 as well.

Given the considerable incentives for biodiesel production and the mandatory minimum renewable fuel requirements to come into effect in the future, biodiesel project developers will be keen to move existing projects forward and develop greenfield projects in the province.

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