EPA just finalized the Renewable Fuel Standard’s (RFS) proposed renewable volume obligations (RVOs) and percentage standards for 2023, 2024 and 2025. As is typically the case, most of the impacted stakeholders had objections, at least in their public positions.
For the specifics, 20.94 billion gallons of renewable fuel is set for 2023, 21.54 billion gallons for 2024 and 22.33 gallons in 2025. Ethanol volumes came out somewhat less than what was proposed at 15 billion gallons. There were moderate increases in biomass-based diesel and advanced biofuels.
One proposal, eRINS for electricity generated from biomass, was dropped. The Energy Marketers of America (EMA) argued that the EPA lacked the authority to implement the proposed eRIN credit for renewable electricity because it is inconsistent with the statutory purpose of the RFS, which is to support the production of renewable fuels, not the production and sale of certain vehicle technologies that eRINS are designed to promote.
Here is some of the specific feedback from various stakeholders:
Clean Fuels Alliance America (supporting bio and renewable diesel) expressed extreme disappointment. It noted EPA finalized moderate increases in the biomass-based diesel and non-cellulosic advanced volumes each year but did not increase the overall renewable fuel market. EPA failed to change biomass-based diesel volumes for 2023 despite the rapid increase in U.S. production of biodiesel, renewable diesel and sustainable aviation fuel during the first months of the year.
“EPA is undercutting the certainty that our industry hoped for from a three-year RFS rule,” said Kurt Kovarik, vice president of federal affairs with Clean Fuels. “U.S. clean fuel producers, oilseed processors, fuel distributors and marketers have all made significant investments to grow the industry rapidly over the next several years. The industry responded to signals from the Biden administration and Congress aiming to rapidly decarbonize U.S. fuel markets, particularly aviation, marine, and heavy-duty transport, and make clean fuels available to more consumers. The volumes EPA finalized today are not high enough to support those goals.”
The Diesel Technology Forum (DTF) felt the EPA’s announcement establishes disappointing future volumes well below all expectations.
“Biodiesel and renewable diesel fuel deliver significant carbon reductions in every application right now,” noted DTF’s Executive Director Allen Schaeffer. “These fuels can be used in any new, or existing, diesel engine. They’re endorsed by engine and equipment makers. Trucking fleets, farmers, contractors, and others use these fuels as an affordable way to help reduce greenhouse gas and other emissions by up to 80%. That’s immediately and without investments in new infrastructure, vehicles or equipment.
“The EPA’s small nudge in biofuel volumes at this time of otherwise progressive climate policies is as confusing as it is inconsistent. The agency states that “Low-carbon fuels are an important part of reducing greenhouse gas (GHG) emissions in the transportation sector, and the RFS program is a key federal policy that supports the development, production, and use of low-carbon, domestically produced renewable fuels.”
Yet rather than issuing a robust and growth-oriented future volume set rule that expands the use of renewable diesel and biodiesel fuels to drive faster and deeper reductions in greenhouse gas emissions, the EPA touts it primarily as an energy security strategy to reduce 140,000 barrels of foreign oil imports.
The American Coalition for Ethanol’s (ACE) CEO Brian Jennings issued the following reaction to EPA’s final rule.
“If EPA’s goal with the Renewable Fuel Standard is to maximize reductions in greenhouse gas (GHG) emissions from the transportation sector, today’s final rule falls short by arbitrarily limiting conventional biofuel use to 15 billion gallons in 2024 and 2025 compared to the Agency’s proposal of 15.25 billion gallons for each of those years,” he said. “Higher blending targets would enable fuels such as E15 and E85 to quickly displace carbon pollution from gasoline, but EPA’s proposal will rein in those opportunities.
“We are supportive of finalizing the 250-million-gallon remedy as a supplemental requirement for 2023 and agree with removing the controversial eRIN proposal from the final rule.”
The American Petroleum Institute (API) was similarly displeased and issued the following statement from Vice President of Downstream Policy Will Hupman.
“We share EPA’s goal of reducing emissions in the transportation sector and are supportive of efforts to improve the Renewable Fuel Standard (RFS) program to advance a lower carbon future,” he said. “While we welcome EPA’s decision to omit the complex regulatory changes from eRINs, we are disappointed the agency did not do more to seize the opportunity to refocus the RFS to further incentivize lower carbon fuels. We look forward to continuing to work with EPA to build on this policy and ensure American consumers have access to the affordable and reliable fuels that they depend on every day while continuing to reduce emissions from transportation.”
NATSO, representing America’s travel plazas and truck stops, and SIGMA: America’s Leading Fuel Marketers, issued the following statement from David Fialkov, executive vice president of government affairs for NATSO and SIGMA.
“This rule takes seriously the old adage, ‘First, do no harm.’ Low-carbon fuel and biofuel investments that have already been made will likely continue to be at least modestly profitable. Lower-carbon gasoline and diesel products should continue to be available at a modest price discount compared with petroleum alternatives. These are good things. The agency raised advanced biofuel blending mandates and is reconsidering the eRIN program for EV charging in response to industry comments, including ours. For that we are grateful.
“At the same time, it’s hard not to be confused and disappointed with the amount of emission reductions that are being left on the table. Instead of pumping the gas pedal, the EPA is keeping the RFS in neutral.”
