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Plans to build a renewable diesel plant near Ferndale have been scrapped. This is why


The two companies behind a proposed renewable diesel plant on the Phillips 66 refinery near Ferndale announced Tuesday, Jan. 21, that they will not build the project.

Phillips 66 and Renewable Energy Group Inc. were behind the proposal and had formed Green Apple Renewable Fuels to build the plant. A release blamed “permitting delays and uncertainties” for the decision to withdraw the project.

Specifically, it was the determination of significance recently issued by the Washington State Department of Ecology and Whatcom County government, which in turn triggered a requirement for an environmental impact statement, according to Tim Johnson, director of Public and Government Affairs for the Phillips 66 refinery near Ferndale.

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“We felt we had provided a very thorough application for the project. We did not expect to have to go through the environmental impact statement process,” Johnson said to The Bellingham Herald on Tuesday, Jan. 21.

That requirement added two years for permitting and that placed the project at risk for not being online until 2024 — putting the project at a competitive disadvantage to other renewable projects out of state, Johnson said.

Renewable Energy Group representatives couldn’t be reached immediately for comment on Tuesday.

Whatcom County government and Ecology were leading the regulatory oversight for the project, which would have been at Cherry Point.

Just last week, the Washington State Department of Ecology was asking the public to say what should be included in an environmental review of the plant and Whatcom County government also was accepting public comment for what was called a notice of application for a major project permit.

And meetings to provide some information about the project to the public had been set for early February.

Those meetings and the environmental review have been canceled after Ecology and Whatcom County were notified on Tuesday, according to an Ecology release.

“The purpose of an environmental review is to fully understand a project’s probable, significant, adverse, environmental impacts, and then determine if those probable impacts can be mitigated,” Ecology said in the release.

“The environmental review of the Green Apple proposal was just days into its scoping period where the public was given its first opportunity to comment on the proposal’s potential environmental impacts,” Ecology said.

Announced in November 2018, the project would have produced 250 million gallons of renewable fuel, primarily diesel, per year — resulting in the largest renewable diesel refinery on the West Coast, according to the companies’ release.

The plant would have been built on about 40 acres of land at the Phillips 66 refinery property at 3901 Unick Road.

The primary fuel produced would have been renewable diesel, with some renewable naphtha and renewable propane and possibly renewable jet fuel, according to a project application.

The project would have processed fats and grease as well as cooking and vegetable oils into renewable fuels.

The existing ship, rail and truck infrastructure at Phillips 66 would have been used to receive feedstocks — the waste fats, oils and greases — for the process and to ship out the finished product, although there were proposed changes to that infrastructure.

“While we believe the Ferndale refinery is a strategic fit for this renewable diesel project, permitting uncertainties were leading to delays and higher costs,” said Robert Herman, Phillips 66 executive vice president of refining, said in the release.

“Phillips 66 continues to progress its portfolio of renewable diesel projects and evaluate new opportunities to provide consumers with renewable fuels that comply with low-carbon fuel standards,” he said.

Renewable Energy Group also provided a statement.

“Although we are disappointed in this result, REG is undeterred and continues to develop numerous opportunities to grow our renewable diesel production,” said Cynthia “CJ” Warner, Renewable Energy Group CEO.

“We remain dedicated to positively impacting the environment and reducing the carbon intensity of transportation fuels through the application of REG’s proven technologies,” she said.

The decision to withdraw from the project was unexpected, according to Eddy Ury, clean energy program manager at RE Sources for Sustainable Communities.

Ury told The Bellingham Herald the project had been moving through an environmental review process in a quick and smooth manner, adding that it was expected to be permitted by 2021.

“For them to say there are unexpected delays or unreasonable barriers doesn’t add up,” Ury said of Phillips 66.

He said RE Sources had been in contact with the project managers during the past year.

RE Sources didn’t have a position on the project but it did support having an appropriate environmental review process, Ury said.

“This project could have been a positive step toward more sustainable alternatives to fossil fuels,” RE Sources said in a statement.

The organization expressed doubt over Phillips 66’s stated reason for pulling out of the project.

“Phillips 66 began this project with Renewable Energy Group in 2018 with full awareness that major projects like this are always required to go through the standard state review process — this is the process that ensures environmental impacts are understood before permitting decisions are made,” RE Sources said in the statement.

In the release, both companies thanked Washington state, Whatcom County, local officials and others for their advice and support during the process.

This story was originally published January 21, 2020 10:41 AM.

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