B.C. to require Canadian-made biofuels to meet standards for gas, diesel

A driver gets gas at a gas station in Mississauga, Ont., Feb. 13, 2024. (Christopher Katsarov / The Canadian Press)

British Columbia is set to require Canadian products to fulfil renewable fuel standards for gasoline and diesel, a move Energy Minister Adrian Dix said was aimed at building a “cleaner, stronger and more self-reliant” province.

Dix said B.C. is too reliant on fuels from outside Canada, making the province vulnerable to market fluctuations and other external pressures.

At the same time, he said the United States provides “dramatic subsidies” for its own biofuel industry to a degree that curtails the industry in B.C. and Canada.

“For too long, B.C. biofuel producers have operated in a market where their American counterparts benefited from subsidies that gave them a considerable competitive advantage,” he told the news conference announcing the changes.

“These subsidies dramatically increased with the Inflation Reduction Act in the United States,” he said during a news conference on Thursday.

B.C. has minimum requirements for biofuels to be added to gasoline and diesel. The province is mandating those fuels be Canadian made, and is increasing the minimum biofuel content for diesel.

Dix conceded the U.S. subsidies for the American biofuel industry provide “some benefits” at the pump for Canadian consumers.

“There is a potential for an impact there, albeit small,” he said, referring to fuel prices.

“But the impact will be far greater later if we allow, if we were to permit, absolutely unacceptable and unfair trade practices to undermine B.C. businesses,” he said.

Dix said it will benefit consumers in the long run to have Canadian companies producing biofuels, as every jurisdiction in the country has biofuel requirements.

It doesn’t make sense to allow the United States to “essentially make it uneconomic” for Canadian companies to produce biofuels.

Dix said the B.C. government’s amendments to regulations under its Low Carbon Fuels Act are aimed at prioritizing and supporting Canadian biofuel, which may be made with items such as plants, animal fats or leftover cooking oils.

The changes mean B.C.‘s requirement for five per cent renewable fuel content for gasoline must be met with Canadian-made fuel starting Jan. 1, 2026.

The province is also boosting the minimum renewable requirement for diesel to eight per cent, up from four per cent, effective immediately, and that threshold must be met with Canadian-made biofuel starting April 1.

Dix said the changes come at a “pivotal” time when B.C.‘s economy faces the “profound” threat of steep American tariffs on Canadian goods.

The province had engaged extensively with stakeholders in the biofuel industry to “make sure these changes work for everyone,” he noted.

The major players in B.C. were supportive, he said.

Ian Quartly, chief financial officer of Tidewater Renewables, joined Dix and said the changes are a positive step toward supporting an economically viable domestic renewable fuels industry.

“Tidewater Renewables and many other Canadian biofuel producers have been experiencing grave financial challenges due to the substantial increase in the volume of subsidized U.S.-renewable diesel physically moving out of the oversupplied U.S. renewable fuel markets and into the higher-value B.C. market.”

Quartly said overlapping U.S. and Canadian low-carbon fuel policies allow American producers to benefit from subsidies and incentives at the point of production, then import their fuel to B.C. and generate emissions credits at the point of sale.

He said the result has been reduced demand for emissions credits, which may be earned by companies such as Tidewater, then sold to others that need to offset their emissions.

Asked whether the province’s changes would restore the value of credits in B.C.‘s market, Dix said they would “strengthen” the system.

This report by The Canadian Press was first published Feb. 27, 2025.

Brenna Owen, The Canadian Press