BioCycle May 2009, Vol. 50, No. 5, p. 25
Federal procurement programs give preference to compost-based fertilizers, and may significantly benefit compost sales, provided producers take the time and effort to inform procurement officials about their products.
OVER the past several years a spate of federal legislation and regulation has emerged directing procuring agencies to buy “green.” Some have direct benefits to compost producers. For example, the U.S. Environmental Protection Agency (EPA) issued its Comprehensive Procurement Guidelines Update No. 4 in September 2007, which revised the compost designation and added fertilizer made from recovered organic materials to the landscape products category.
Section 9002 of the Farm, Security and Rural Investment Act of 2002 (aka the “Farm Bill”) established preferences for federal “biobased” procurement programs. Presidential Executive Order 13423 (issued in January 2007), entitled “Strengthening Federal Environmental, Energy and Transportation Management,” contained instructions to federal agencies for developing “green procurement policies.” In May 2008, the U.S. Department of Agriculture (USDA) issued its “Designation of Biobased Items for Federal Procurement.” Most recently, the 2008 Farm Bill (officially the Food, Conservation and Energy Act of 2008) set funding for testing and labeling activities for the period 2008-2012 for biobased products.
This article profiles two programs, the EPA Comprehensive Procurement Guidelines (CPG) and the USDA BioPreferred Program. Other federal programs can be accessed from the website of the Office of the Federal Environmental Executive (OFEE): www.ofee.gov. All federal agencies have an Environmental Executive, usually in the Procurement Office, who is responsible for ensuring agency compliance with Environmentally Preferable Purchasing requirements.
The CPG program (www.epa.gov/cpg) is authorized by Congress under Section 6002 of RCRA and Executive Order 13101. EPA is required to designate products that are, or can be, made with recovered materials, and to recommend practices for buying these products. Once a product is designated, procuring agencies are required to purchase it with the highest recovered material content level practicable.
EPA’s CPG Product Supplier Directory lists 32 compost producers that manufacture qualified materials. In 2004, EPA finalized regulations that redefined its CPG to include composts made from biosolids and manures (the definition had been limited to composts made from food waste and from yard waste) and also to include organic fertilizers made from recovered organic materials.
“CPG was developed in 1995 with the goal of stimulating markets for recycled materials,” says Deborah Hanlon, Chief of the Materials Conservation and Recycling Branch in EPA’s Office of Resource Conservation and Recovery. “Our focus now is on implementation, to get the word out to federal agencies and to users of federal funds that they must comply with these requirements.” Hanlon explains that while there are not currently any plans to expand the list of 67 designated items on EPA’s CPG website, the Agency could consider adding compost-based specialty soils (like growth media for bioretention ponds). “Designating a product is a regulatory process, so a new regulation would have to be developed to add compost-based specialty soils,” she adds. “We would start by researching how much of the product is purchased with federal funds, then propose a regulation to add it to the CPG list. After doing the initial research, this process takes about two years.”
Under the CPG system, federal agencies (also state and local agencies, and contractors working with federal funds) must preferentially purchase products containing the highest percentage of recovered materials practicable. Procuring agencies are defined as any federal agency; any state or local agencies using appropriated federal funds for a procurement; or, any contractors with these agencies (with respect to work performed under the contract). The requirements of Section 6002 of the Resource Conservation and Recovery Act (RCRA), which were effective in January 1994, apply to procuring agencies only when the price of the material procured exceeds $10,000 or when the agency has purchased more than $10,000 of a product in the preceding year. This threshold limit can apply to both goods and services if they are procured together (e.g., a landscaping project that involves both materials and labor).
A procuring agency may not always be able to purchase a designated item with recovered materials content. RCRA section 6002(c)(1) allows a procuring agency the flexibility not to purchase an EPA designated item with recovered materials content if any of the following conditions apply: the agency is unable to secure a satisfactory level of competition; the item is not reasonably available within a reasonable period of time; the item fails to meet the performance standards set forth in the agency’s specifications; or the item is available only at an unreasonable price.
EPA also issues guidance on buying recycled-content products in Recovered Materials Advisory Notices (RMANs). The RMANs recommend recycled-content ranges for CPG products based on current information on commercially available recycled-content products. RMAN levels are updated as marketplace conditions change.
USDA’s BioPreferred Program is similar to EPA’s CPG. On May 14, 2008, USDA issued three final rules that added 27 new items to the list of designated biobased items that are afforded a federal purchasing preference under Section 9002 of the Farm Security and Rural Investment Act of 2002. Federal agencies and contractors are required to purchase USDA-designated biobased items unless they determine that products are not reasonably available, fail to meet performance standards, or are available at an unreasonable price. Federal agencies will be required to give a purchasing preference for qualifying biobased products within the 27 new designated items categories no later than May 14, 2009.
A biobased material is an organic material in which carbon is derived from a renewable resource via biological processes, including all plant and animal mass derived from CO2 recently fixed via photosynthesis (therefore a renewable resource). Biobased materials are considered a means to reduce the consumption of nonrenewable resources and reduce the environmental impact associated with the creation of materials and products, such as increased CO2 emissions, etc.
One item on the USDA list that pertains to compost is “fertilizers” that must have a minimum 71 percent biobased content. USDA defines fertilizers as “products formulated or processed to provide nutrients for plant growth and/or beneficial bacteria to convert nutrients into plant usable forms. Biobased fertilizers, which are likely to consist mostly of biobased components, may include both biobased and chemical components.” Determination of biobased content is done with radiocarbon analysis using ASTM D6866: “Standard Guide for Determination of Biobased Content, Resources Consumption, and Environmental Profile of Materials and Products.” One lab conducting this testing is Beta Analytic in Miami, Florida.
USDA has an active initiative to promote the BioPreferred Program. “Our intent is to lead by example and on our website are templates for entering biobased purchase requirements into service or other contracts,” says Ron Buckhalt, USDA’s BioPreferred Program Manager. “Most federal purchases, with the exception of the Department of Defense, are made though contracts for services. And the 2008 Farm Bill strengthened that requirement for all groups doing business with the federal government. We are constantly meeting with all federal agencies to facilitate communications between both their procurement and environmental sides. One of the biggest events in our marketing year is the General Services Administration Expo. It is in San Antonio this year, where about 10,000 federal, state and local government buyers will gather. We have a BioPreferred trade show and training program just before the conference opens and the training continues when the event starts.”
One of the compost producers, ERTH Products (Peachtree City, Georgia), is included on the USDA BioPreferred Product Listing website. The listed product, ERTH FOODTM Organic Composted Fertilizer, was tested in 2005 for its biobased content. “The testing was done by Iowa State University,” says Wayne King, Sr., CEO of ERTH Products. “Our biosolids compost had a 91 percent biobased content, which was greater than the USDA minimum requirement, but we had to wait until the regulations were finalized in May 2008 before the product could be listed.” King notes that ERTH Products had already registered its compost product as a fertilizer in 12 states prior to being listed as a biobased fertilizer in the USDA directory, but that compost producers whose products are listed as fertilizers with the USDA will also likely fall under the jurisdiction of state agencies that regulate fertilizers. This normally involves annual fees based on tonnages sold and periodic testing of fertilizers to verify the accuracy of claims for guaranteed analysis nutrient contents.
It is difficult to accurately assess the potential benefits to the organics recycling industry, as there is little, if any, data on how much compost, soil amendment, blended soils or fertilizer is purchased by federal agencies (or its contractors). “We do not track data on purchases of commodities such as fertilizers,” says Dana Arnold, Chief of Staff to the Office of the Federal Environmental Executive, the group that advises the federal agencies, makes recommendations concerning policy, facilitates implementation, provides a centralized focal point for assistance and direction, and helps educate and train people in the requirements of E.O. 13423. “The majority of these purchases are made as part of services contracts and the invoices don’t break this information out.”
This may be changing soon, though. “There is a work group that held its first meeting in March to begin to map out a workable approach,” says Buckhalt of USDA. “I am a member of that group. It is abundantly clear that you have to know where you are in order to measure how far you are moving up or down a point. We hope the move is up (increased consumption) and that it is measurable.”
Producers of organic products that meet either EPA’s definitions under the CPG program or USDA’s definitions under the BioPreferred Program (or both) can realize potential sales benefits from being involved, provided they take steps to maximize this potential. Important actions to be taken include: proving the product(s) meet applicable specifications; developing tailored specifications if they don’t already exist (see below); and developing communications and working relationships with federal procurement officials, state Department of Transportation officials, and Department of Defense bases, among others. Proving that products meet specifications could require radiocarbon testing to verify the minimum biobased content needed under the USDA program, chemical testing to verify that specified nutrient contents are met, and physical testing to verify parameters such as organic matter content, pH and bulk density.
Developing specifications suitable for incorporation into construction documents that call for the use of listed environmentally preferred products may be needed for use by qualified procurement officials. These written specifications should follow the format and content requirements of the sourcing agency. Compost producers should review existing project construction specifications to be sure that there is no language in their specifications related to landscaping, soil amendments, erosion control or soil reclamation that would preclude or discourage the use of compost. If, for instance, specifications address the use of straw or hay in roadside revegetation projects, procuring agencies should assess whether compost could substitute for straw or hay or be used in combination with them.
Compost producers understand the value of personal working relationships in the success of marketing and sales efforts. Selling to federal agencies (or their contractors) is no different. Producers should seek out knowledgeable procurement officials at nearby federal facilities to find out what projects are planned, what procurement documents exist, how materials will be procured for a particular job, and the appropriate architect/engineer firm and/or construction contractors.
These federal preferential procurement programs can help compost producers increase sales, provided that they take the time and effort to inform procurement officials about their products.
Craig Coker is a Contributing Editor to BioCycle, and a Principal in the firm of Coker Composting & Consulting near Roanoke, Virginia (www.cokercompost.com). He can be reached at firstname.lastname@example.org.
SIDEBAR p. 27
BUCKS FOR BIOFUELS
THE U.S. Secretary of Energy Steven Chu announced plans in early May to provide $786.5 million from the American Recovery and Reinvestment Act to accelerate advanced biofuels research and development and to provide additional funding for commercial-scale biorefinery demonstration projects. The U.S Department of Energy (DOE) Biomass Program will leverage DOE’s national laboratories, universities, and the private sector to help improve biofuels reliability and overcome key technical challenges, with the goal of creating third-generation biofuels like green gasoline, diesel and jet fuels, according to DOE’s Energy Efficiency and Renewable Energy office, which released the news.
The $786.5 million in Recovery Act funds is a mix of new funding opportunities and additional funding for existing projects. It will be allocated across four main areas:
$480 Million Solicitation for Integrated Pilot- and Demonstration-Scale Biorefineries – Projects selected under this Funding Opportunity Announcement will work to validate integrated biorefinery technologies that produce advanced biofuels, bioproducts, and heat and power in an integrated system, thus enabling private financing of commercial-scale replications. DOE anticipates making 10 to 20 awards for refineries at various scales and designs, all to be operational in the next three years. The DOE funding ceiling is $25 million for pilot-scale projects and $50 million for demonstration-scale projects.
$176.5 Million for Commercial-Scale Biorefinery Projects – The $176.5 million will be used to increase the federal funding ceiling on two or more demonstration- or commercial-scale biorefinery projects that were selected and awarded within the last two years. (See “Commercializing Cellulosic Ethanol,” November 2008, and “Accelerating The Cellulosic Ethanol Industry,” January 2009.) The goal of these efforts is to reduce the risk of the development and deployment of these first-of-a-kind operations. Funds are expected to expedite the construction phase of these projects and ultimately accelerate the timeline for start up and commissioning.
$110 Million for Fundamental Research in Key Program Areas – The Biomass Program plans to use $110 million to support fundamental research in key program areas, distributed in the following manner: Expand resources available for sustainability research through the Office of Science Bioenergy Research Centers and establish a user-facility/small-scale integrated pilot plant ($25 million); Create an advanced research consortium to develop technologies and facilitate subsequent demonstration of infrastructure-compatible biofuels through a competitive solicitation ($35 million); Create an algal biofuels consortium to accelerate demonstration of algal biofuels through a competitive solicitation ($50 million).
$20 Million for Ethanol Research – The Biomass Program is planning to use $20 million of the Recovery Act funding in a competitive solicitation to achieve the following: Optimize flex-fuel vehicles operating on high octane E85 fuel (85% ethanol, 15% gasoline blend); Evaluate the impact of higher ethanol blends in conventional vehicles; Upgrade existing refueling infrastructure to be compatible with fuels up to E85. More information on these programs can be found at www.eere.energy.gov.
Private sector investors will likely be buoyed by this recent news, as they have pulled back over the past few months. “While the long term outlook for the industry remains optimistic, it will not be without a lot of winners and losers,” says Kelly Sarber, President of Strategic Management Group in California. “The industry challenges continue to be the costs to create a gallon of fuel versus oil, a national inertia to make the necessary infrastructure changes to bring a new fuel mix to market and the flexibility of vehicles to operate on fuel mixtures. The key competitive drivers will be the need to create long-term investment partners that don’t depend on short-term exit strategies, ability to identify and secure ideal logistical locations for plants and regional distribution hubs, cementing of long-term supply agreements with strategic feedstock sources and delivery systems of getting the actual fuel to market.”
– Nora Goldstein
May 27, 2009 | General
Uncle Sam Buys Green
BioCycle May 2009, Vol. 50, No. 5, p. 25