EPA proposes 3 years of progressively higher renewable fuel blending

Dec. 2, 2022
The Biden administration has released a proposed rule for year-by-year expansions of refiner obligations under the Renewable Fuel Standard (RFS) for 2023-2025.

The Biden administration has released a proposed rule for year-by-year expansions of refiner obligations under the Renewable Fuel Standard (RFS) for 2023-2025.

The RFS, primarily an ethanol blending mandate for gasoline, supports corn farming and frustrates refiners who object to its costs and logistical challenges. For small refiners, in particular, it can be a strain as they pay for credits when they cannot arrange for sufficient volumes of renewable fuel.

The credits, called renewable identification numbers (RINs) in regulatory jargon, have sold at near-record prices for much of 2022, according to the Energy Information Administration (EIA).

The Environmental Protection Agency (EPA) released its proposed rule Dec. 1 with volume mandates going up for renewable fuel overall and for specific types of renewables: cellulosic biofuel, biomass-based diesel, and advanced biofuel.

The renewable fuel obligation for 2023 would be 21.07 billion gal (including a supplemental 250 million gal blamed on a court ruling), 21.87 billion gal for 2024, and 22.68 billion gal for 2025.

The ethanol blend rate for US gasoline reached a new record high of 10.5% last summer, according to the EIA. The agency attributed that primarily to ethanol costing less than equivalent amounts of petroleum in gasoline during a period of high oil prices.

The EPA added a new twist to its RFS plans. It proposed for the first time that the RFS program provide credits for electricity generation from renewable biomass to the extent that such generation is for transportation.

Refiners object

Public comments on the proposed rule must be received by EPA no later than Feb. 10, according to the 692-page document. Some comments already have been issued in statements of criticism from a refiners group and praise from an association advocating for renewable fuels.

EPA’s proposal “doubles down on some of the program’s most problematic elements without taking meaningful steps to address fundamental RFS design flaws,” said Geoff Moody, senior vice-president of government relations and policy at the American Fuel & Petrochemical Manufacturers, which represents most US refiners.

“For the final rule, EPA must go back and set conventional volumes that are aligned with consumer demand and infrastructure realities,” Moody said. He added that the agency should reject “yet another massive regulatory subsidy for electric vehicle manufacturers.”

The proposed rule was welcomed by Geoff Cooper, president of the Renewable Fuels Association.

“Once finalized, this rule will significantly accelerate growth and investment in the low-carbon renewable fuels that will help decarbonize our nation’s transportation sector, extend domestic fuel supplies, and bolster the rural economy,” Cooper said.

Environmentalists object

Julie Sibbing, a vice-president of the National Wildlife Federation, said the Biden administration “cannot reach its climate goals and address rising food costs by plowing more corn into consumers’ gas tanks.” Her reference to food costs was a reminder that growing more corn for gasoline can mean less agricultural land devoted to growing food for people and farm animals.

Sibbing described the proposal as bad for public health, air and water quality, wildlife, and the goal of a clean-energy future. And she cast doubt on the wisdom of promoting biomass.

“The decision to allow electricity generation from biogas was made years ago, but EPA’s approach to implementing this policy may unintentionally encourage industrial agricultural production,” Sibbing said.