Following a recent announcement that the Environmental Protection Agency (EPA) would reject petitions to move the Renewable Fuel Standard (RFS) point of obligation and not allow Renewable Identification Number credits (RINs) for exported ethanol, RINs are trading higher and ethanol opponents have renewed efforts to characterize RINs as driving fuel prices higher. Meanwhile, some ethanol producers and marketers are taking advantage of the higher RIN values to offer denatured ethanol as low as 30 cents per gallon and E85 at 55 cents per gallon (plus tax and freight) this week.
American Coalition for Ethanol (ACE) Senior Vice President Ron Lamberty says, in fact, RINs do exactly the opposite of what critics claim, and the proof is higher ethanol-blended fuels at lower prices at the pump in real-world stations across the U.S. A RIN credit is a reward for RFS compliance. Companies complying with the RFS or blending more ethanol than required are able to use the additional RINs to discount prices of ethanol-blended fuels.
This week, ACE member Glacial Lakes Energy (GLE) announced it was making “RINless” denatured ethanol available to retailers for just 30 cents per gallon, and ACE member Absolute Energy was offering “RINless” E85 for just 55 cents. RINless means the RIN is retained by the seller, and its value is subtracted leaving a low net fuel price.
“There are a growing number of retailers buying RINless ethanol directly from producers like Absolute Energy and GLE,” Lamberty said. “The idea that small, independent station owners can’t benefit from RINs just isn’t true. Owners of single stores and small chains are the primary buyers of this RINless ethanol and E85.”
“After taxes and freight, the wholesale cost of E85 is under a dollar for many Midwest markets,” Lamberty added. “And pricing that reflects the discount earned from the extra RINs in higher ethanol blends is available in other markets, too. We’re constantly looking to match E15 and flex fuel retailers with ethanol suppliers who will sell them competitively priced fuels.”
Examples of other fuel marketers offering wholesale, RINless ethanol and E85 can be found on the Iowa Renewable Fuels Association website here.