### July 16, 2010

MEMORANDUM

TO: Air and Radiation Docket EPA-HQ-OAR-2010-0133

SUBJECT: Summary of M odeling Input Assumptions for Canola Oil Biodiesel

for the Notice of Supplemental Determination for Renewable Fuels

Produced Under the Final RFS2 Program

This memorandum provides information on the key input assumptions used for modeling

the canola oil biodiesel lifecycle pathway. Assumptions include crop yields, energy use,

fertilizer use, etc. Data sources are pres ented to promote transparency on our modeling

inputs.

## Canola Data

Agricultural Sector Inputs

Category Assumption Source

Production

Crop Yield (unit/acre)

(historical) 1,461 lbs seed/acre

(U.S., 2008)

1,735 lbs seed/acre

(Canada, 2008) http://quickstats.nass.usda.gov/

USDA Production, Supply and Distribution (PS&D) Database,

http://www.fas.usda.gov/psdonline/

Crop Yield (unit/acre)

(projected) 1,681 lbs seed/acre

(U.S. Avg., 2022)

1,806 lbs seed/acre

(Canada, 2022) Based on historic trends, see discussion and Figure 2 below

Based on historic trends, see discussion and Figure 4 below

Harvested acres

(historical) 989 thousand acres

(U.S., 2008)

16 million acres

(Canada, 2008) http://quickstats.nass.usda.gov/

USDA Production, Supply and Distribution (PS&D) Database,

http://www.fas.usda.gov/psdonline/

Harvested acres

(projected) 0.9 M acres

(U.S., 2022)

1.2 M acres

(U.S., 2022)

17.4 M acres

(Canada, 2022)

17.6 M acres

(Canada, 2022) FASOM modeled results without increase in canola oil biodiesel

production

FASOM modeled results with increase in canola oil biodiesel

production

FAPRI modeled results without increase in canola oil biodiesel

production

FAPRI model ed results with increase in canola oil biodiesel

production

Energy Use

Gasoline See Table 1&2 U.S. rates based on various state and regional crop budgets, see

EPA

‐ HQ

‐ OAR

‐ 2005

‐ 0161

‐ 3178 (Technical Report describing the

FASOM model) and Renewable Fuel Standard Program (RFS2)

Regulatory Impact Analysis (RIA) Section 2.4.2.1 “Domestic Crop

Inputs” for more information

Diesel See Table 1&2 U.S. rates based on various state and regional crop budgets, see

EPA

‐ HQ

‐ OAR

‐ 2005

‐ 0161

‐ 3178 and RFS2 RIA Section 2.4.2.1 for

more information

Canadian rates based on Agriculture and Agri

‐ Food Canada

Research Centers and the University of Manitoba data, see

“CANOLA LCA DATA” report in the docket from the Canola Council

of Canada for more i nformation

2Electrici ty See Table 2 Canadian rates based on USDA energy survey data for wheat in the

northern tier states of Minnesota, North Dakota, and Montana,

adjusted for Canola, see “CANOLA LCA DATA” report in the docket

from the Canola Council of Canada for more information

Fertilizer Use

Nitrogen

Phosphorus

Potassium See Table 3&4 U.S. rates based on various state and regional crop budgets, see

EPA

‐ HQ

‐ OAR

‐ 2005

‐ 0161

‐ 3178 and RFS2 RIA Section 2.4.2.1 for

more information

Canadian rates based on the Food and Agricultural Organization's

Fertistat database, which reports fertilizer use by crop and by

country, for a single year between 1988 and 2004.

( www.fao.org/ag/agl/fertistat/ ). Also described in “Notable

Revisions and Recalculations: International Agriculture GHG

Emissions and GHG Metrics” (2009) see docket ID EPA

‐ HQ

‐ OAR

‐

2005

‐ 0161

‐ 3037

Others Inputs Use

Herbicide

Fungicides &

Bactericides

Insecticides See Table 3&4 U.S. rates based on various state and regional crop budgets, see

EPA

‐ HQ

‐ OAR

‐ 2005

‐ 0161

‐ 3178 and RFS2 RIA Section 2.4.2.1 for

more information

Canadian rates based on Chemical Consumption Rates and

Agricultural Area from FAO’s FAOSTAT Database

(http://faostat.fao.org/site/395/default.aspx) Also described in

“Notable Rev isions and Recalculations: International Agriculture

GHG Emissions and GHG Metrics” (2009) see docket ID EPA

‐ HQ

‐

OAR

‐ 2005

‐ 0161

‐ 3037

Canadian canola N 2 O

Emissions See Table 5 Environment Canada and Agriculture Canada Tier 2 country

‐ specific factors, see2006 IPCC Guidelines for National Inventories,

Volume 4, Chapter 11: N 2 O Emissions from Managed Soils, and CO 2

Emissions from Lime and Urea Application (for methodological

approach)

U.S. canola N 2 O

Emissions Included in FASOM

model See RFS2 RIA Section 2.4.2.2 “Domestic Nitrous Oxide Emissions”

for more information



### Canola Crushing

Category 

### Assumption Source

Energy Use

Natural Gas 1.0 GJ/tonne seed crushed

2.34 GJ/tonne oil produced Canadian Oilseed Processors Association

survey data, see “CANOLA LCA DATA”

report in the docket from the Canola

Council of Canada for more information

Electricity 49 GJ/tonne seed crushed

114.5 GJ/tonne oil produced Canadian Oilseed Processors Association

survey data, see “CANOLA LCA DATA”

report in the docket from the Canola

Council of Canada for more information

3Yields

Canola Oil 0.40 lbs oil / lb canola seed USDA Production, Supply and Distribution

(PS&D) database,

http://www.fas.usda.gov/psdonline/

Canola Meal 0.61 lbs meal / lb canola seed USDA Production, Supply and Distribution

(PS&D) database,

http://www.fas.usda.gov/psdonline/



### Biodiesel Production

Category 

### Assumption Source

Energy Use

Natural Gas 1,459 Btu/gal biodiesel USDA Process energy model, see RFS2

RIA Section 2.4.7.3.3 “Conversion of Oil

to Biofuel” for more information

Electricity 575 Btu/gal biodiesel USDA Process energy model, see RFS2

RIA Section 2.4.7.3.3 “Conversion of Oil

to Biofuel” for more information

Yields

Biodiesel from Canola Oil 7.6 lbs canola oil / gal biodiesel RFS2 final rule analysis

– same as

soybean oil

Co

‐ product (glycerine) Replaces residual oil RFS2 final rule analysis

– same as

soybean oil



### Volume Scenarios

Assumption Source

Future potential production 200 MG by 2022 Estimated market potential from

feedstock availability, competing uses,

etc. See text below for more

information.



### Table 1. U.S. Agricultural Energy Use

Input GP LS RM PNWE SW Units

Gasoline NA NA 0.6 NA NA gal/acre

Diesel 4.0 4.1 7.1 5.4 4.3 gal/acre



### GP: Great Plains; LS: Lake St ates; RM: Rocky Mountains;

PNWE: Pacific Northwest-East side; SW: Southwest

Table 2. Canadian Agricultural Energy Use

Input Amount Units

Gasoline NA NA

Diesel 3.60 gal/acre

Electricity 29.64 kWh/ha

4

### Table 3. U.S. Fertilizer, Herbicide, In secticide and Other Agricultural Inputs

Input GP LS RM PNWE SW Units

Nitrogen Fertilizer (as N) 64.6 65.2 61.0 110.0 89.3 lbs/acre

Phosphorus Fertilizer (as

P 2 O 5 ) 20.0 20.0 32.1 NA 23.0 lbs/acre

Potassium Fertilizer (as K 2 O) 30.0 30.0 9.3 NA NA lbs/acre

Herbicides 0.6 0.6 0.6 0.2 0.8 lbs/acre

Insecticides 0.6 0.6 0.6 0.3 0.5 lbs/acre



### Table 4. Canadian Fertilizer, Herbicide, Insecticide and Other Agricultural Inputs

Input Amount Units

Nitrogen Fertilizer (as N) 75.0 kg/ha

Phosphorus Fertilizer (as P 2 O 5 ) 20.0 kg/ha

Potassium Fertilizer (as K 2 O) 15.0 kg/ha

Fungicides & Bactericides 0.042 kg/ha

Herbicides 0.342 kg/ha

Insecticides 0.047 kg/ha



### Table 5. Canadian N 2 

### O Emission Factors

Factor Amount

Dry matter fraction of harvested

product (DRY) 0.26

RAG(T) 2.31

NAG(T) 0.007

RBG(T) 0.58

NBG(T) 0.01



### Yield Trends for Canola in the U.S.

Figure 1 shows U.S. canola yields for 1991 to 2008 with the trend estimated for

the same period. The EPA national-level projec tion for canola yield (s ee Figure 2) is an

extension of the historical data trend forw ard to 2022. EPA’s yield growth estimate for

canola in the U.S. was based on the same appro ach as used for all crops in the RFS2 final

rule analysis, see RFS2 RIA Section 5.1.3 “Key Modeling Assumptions” for more

information on yield growth projections in the analysis. The US DA baseline yield

growth (from the USDA canola baseline projections availabl e in the Docket for this

NODA) is based on the same historic data but EPA considers yield changes

independently for different regions in the U.S. whereas USDA uses national aggregate

values, EPA believes it’s approach is more accu rate because it takes into account regional

differences.

5

### Figure 1. U.S. Canola Yields (historical)

0 200 400 600 800 1000 1200 1400 1600 1800Lbs/Acre

Canola yield Linear (Canola yield)



### Figure 2. U.S. Canola Yields (projected)

0 200 400 600 800 1000 1200 1400 1600 1800

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022PoundsperAcre 

# U.S. Canola Seed Yield Over Time

USDA

EPA



### Yield Trends for Canola in Canada

Figure 3 shows Canadian canola yields for the 1982/1983 to the 2008/2009

marketing years, with the trend estimated fo r the same period. Projections for the RFS2

6

### runs start in 2009/2010, thus 2008/20 09 is the last year for the data analysis (see Figure

4). The slope for the period is 0.0199 tons per h ectare per year. This is the slope used in

the analysis. Yield growth for canola intern ationally was based on the same approach as

used for all crops in the RFS2 final rule analysis, see RFS2 RIA Section 5.1.3 “Key

Modeling Assumptions” for more information on yi eld growth projections in the analysis.

Figure 3. Canadian Canola Yields (historical)

y = 0.0199x + 1.1063

0 0.5

1 1.5

2 2.5tons/ha



### Yields Linear (Yields)



### Figure 4. Canadian Cano la Yields (projected)

0 500 1000 1500 2000 2500

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022PoundsperAcre 

# Canadian Canola Seed Yield Over Time

Canola Council

EPA

7

### Volume Scenarios

The following section describes our rationale for assuming an incremental volume of 200

million gallons of canola oil biodiesel for modeling the impact of an increase of canola

oil biodiesel by 2022. This volume was based on the evaluation of historical volumes,

potential feedstock availability and compe titive uses (e.g., for food or export instead of

for domestic fuel), potential increases in cr op acreage, and potential increases in crop

yields.

Historical U.S. Canola Biodiesel Production: According to inform ation provided by the

National Biodiesel Board, the U.S. Canol a Association, and other stakeholders,

production of U.S. canola biodiesel in 2008 and 2009 was approximately 96 million

gallons and 35 million gallons, respectively. 1 

### See Table 6 for a list of facilities. To put

this in perspective, U.S. canola biodiesel made up 13.9% of total biodiesel produced in

2008 and 6.4% of total biodiesel produced in 2009. See Figure 5 for an estimate of

historical U.S. biodiesel production. 2



### Table 6. Canola Biodiesel Capacity and Production

Facility Name Annual Capacity

(Mgal) Approximate Volume

Produced 2008 (Mgal) Approximate Volume

Produced 2009 (Mgal)

Archer Daniels

Midland (ADM) 85 61.6 20.2

Imperium Renewables 100 26 10

Western Dubuque 30 8 3.7

Inland Empire

Oilseeds 8 .02 0.4

Sun Power Biodiesel 3 .15 0.7

TOTAL 226 96 35

1 U.S. Canola Association & Canola Biodiesel Stak eholders, Document submitted to EPA “RE: Canola

Life-Cycle Analysis (LCA) Information”, April 8, 2010.

2 National Biodiesel Board, “Biodiesel Fact Sheets: Biodiesel Production Estimates CY2005- current”,

http://www.biodiesel.org/resources/fuelfactsheets/

8

### Figure 5. Estimated U.S. Biodiesel Pro duction by Calendar Year (gallons)

We can use our understanding of historical mark et share of canola oil biodiesel to project

future volumes. EISA requires that, at a mi nimum, the biomass-based diesel standard

require the use of 1 billion ga llons per year in 2013 and beyond. 3 

### We anticipate,

however, that additional biodies el could potentially be used to meet the “un-specified”

advanced biofuel category, thus exceeding the 1 billion gallon minimum from the

biomass-based diesel standard. 4 

### For the final RFS2 rule, we had assumed 1.67 billion

gallons could be possible from all biodiesel f eedstocks in 2022. If we assume that canola

oil biodiesel maintains similar biodiesel ma rket share as seen in 2008 and 2009 projected

to 2022 (13.9% or 6.4% of 1.67 billion gall ons), it appears reasonable that 107-232

million gallons of canola oil biodiesel could be produced in 2022. We believe there is

good reason that canola oil biodie sel could either maintain its current market share or

possibly even improve it over time given the gr owing interest and potential uses for this

crop. Thus, an incremental volume change of 200 million gallons by 2022, representing

the recent canola market share times projec ted total biodiesel production in 2022 appears

to us to provide a reasonable estimate of canola oil production for purposes of our

modeling effort.

While we described above the market dema nd potential for canola oi l biodiesel, there

must also be enough supply of canola feed stocks to actually produce the volumes

demanded. The following sections evaluate the factors that influence the volume of

canola oil available for the markets and show, th at given these factors, it is reasonable to

assume 200 million gallons of canola oil biodiesel by 2022.

3 EPA is authorized to require larger volumes afte r considering the factors specified in Clean Air Act

211(o)(2)(B)(ii).

4 Assuming no waivers, the advanced biofuels standard for 2022 is 21 bgal: 1bgal is biomass-based diesel,

16 bgal is cellulosic biofuels, the remaining 4 bgal is un-specified advanced biofuels.

910 

### Potential Feedstock Availability & Uses: Canola oil is prim arily used for food, with the

remainder used for industrial purposes (e.g., biodiesel, lubricants, etc.). 5 

### Current U.S.

production of canola is approximately 1.4 billion pounds which equates to roughly 0.6

billion pounds of oil. As noted, about 35 million gallons of canola-based biodiesel was

produced in the U.S. Assuming a convers ion yield of approximately 7.6 pounds canola

oil per gallon biodiesel (as was assumed fo r soybean oil biodiesel for the final RFS2

analysis), about 270 million pounds would have been needed to produce 35 million

gallons of canola biodiesel in 2009. This amount is about a third of th e total current U.S.

production of canola oil. Thus, even wit hout any additional production, maximum use of

U.S. canola production for biodiesel could yield up to ~80 million gallons.

In addition to U.S. production of canola oil, it can also be imported from Canada. In

2008, Canada grew 16 million acres of canola with an average yield of 1,735 lbs of

seed/acre, if all this were converted to oil it would result in approximately 11 billion

pounds of oil. Possible conversion of this volume to biodiesel would yield about 1.4

billion gallons of canola o il biodiesel. In 2008, the US imported approximately 2.3

billion pounds of Canola oil, representi ng approximately 1/5 of Canadian canola

production in that year. It can be expected that in the future much of the Canadian canola

production would continue to be used in Cana da rather than impor ted, and much of the

imports to the US would likely continue to be used for food purposes, so only a relatively

small portion of potential Canadian production is likely to be availa ble for US biofuel

production. Nevertheless, the large potential for import of Canadian canola supports the

assumption that 200 million gallons of canola biodiesel could be produced in 2022 for

use in the U.S.

Increased Crop Yield and Acreage: The agricultural models project increased canola

yields over time based on historical trends. Refer to the section on yields above for more

information. Increased yields allow for grea ter volumes of canola oi l to be produced per

a given amount of area. In addition, the mode ls also project expa nsion of total canola

crop acreage. This expansion alone including yield growth has the potential to add more

than 200 million gallons of canola oil biodiesel by 2022.

Therefore, our evaluation of existing canol a production and projected increase in

production from improving yiel ds and expanded acres suppo rts a conclusion that 200

million gallons of incremental volume of canola oil biodiesel by 2022 is a reasonably

attainable estimate for modeli ng purposes. We have discussed this volume assumption

with industry and USDA repres entatives, and they have agre ed that this assumption is

within reason.

5 USDA Economic Research Serv ice, Soybeans and Oil Crops: Canola Seed, Oil, and Meal

http://www.ers.usda.gov/Briefing /SoybeansOilcrops/Canola.htm