The U.S. Environmental Protection Agency (EPA) announced final volume requirements under the Renewable Fuel Standard (RFS) program today for the years 2014, 2015 and 2016, and final volume requirements for biomass-based diesel for 2014 to 2017.

This rule finalizes higher volumes of renewable fuel than the levels EPA proposed in June. Under the rule, U.S. fuel blenders will be required to mix 16.93 billion gallons of biofuels into fossil fuels in 2015 and 18.11 billion gallons in 2016, a 4 percent increase from the amounts in the proposed rule issued in June, but less than what Congress intended when it expanded the RFS program eight years ago.

Of that, conventional corn ethanol will make up 14.05 billion gallons in 2015 and 14.5 billion gallons in 2016, making up the bulk of the biofuel blended in the U.S. gasoline supply. This requirement is a slight increase over what was proposed earlier this year and about 1 billion gallons below the statutory level of 15 billion gallons annually for 2015 and beyond.

RFS backers have promoted ethanol’s low-carbon qualities, while doubters questioned the conventional wisdom that ethanol reduces global warming. But the announcement of the new RFS was done to coincide with President Obama's speech at the U.N. climate conference in Paris.

The RFS was enacted in 2005 and expanded with the 2007 Energy Independence and Security Act, which set the country on a path to produce 36 billion gallons of biofuels annually by 2022.

The EPA issued a highly complementary announcement in regard to ethanol and biofuels, but it still cut the levels of use required. “The biofuel industry is an incredible American success story, and the RFS program has been an important driver of that success—cutting carbon pollution, reducing our dependence on foreign oil and sparking rural economic development,” said Janet McCabe, the acting assistant administrator for EPA’s Office of Air and Radiation. “With today’s final rule, and as Congress intended, EPA is establishing volumes that go beyond historic levels and grow the amount of biofuel in the market over time. Our standards provide for ambitious, achievable growth.”

The EPA announcement gave credit to the Obama Administration. “The final RFS is an important part of the Obama Administration’s strategy to take action on climate change by propelling the U.S. toward a clean energy future. With final standards in place for the year ahead, biofuel producers and blenders are in a better position to plan and invest—putting the market on stable ground and supporting further growth and innovation in the renewable fuels industry.

“The final 2016 standard for cellulosic biofuel—the fuel with the lowest carbon emissions—is nearly 200 million gallons, or 7 times more, than the market produced in 2014. The final 2016 standard for advanced biofuel is nearly 1 billion gallons, or 35 percent, higher than the actual 2014 volumes; the total renewable standard requires growth from 2014 to 2016 of more than 1.8 billion gallons of biofuel, which is 11 percent higher than 2014 actual volumes. Biodiesel standards grow steadily over the next several years, increasing every year to reach 2 billion gallons by 2017.”

The RFS, established by Congress, requires EPA to set annual volume requirements for four categories of biofuels. The EPA received more than 670,000 public comments, and EPA administers claimed they relied on the latest, most accurate data available. It was the contention by EPA that it “finalized 2014 and 2015 standards at levels that reflect the actual amount of domestic biofuel used in those years, and standards for 2016 (and 2017 for biodiesel) that represent significant growth over historical levels. 

Final Renewable Fuel Volumes            

 

2014

2015

2016

2017

Cellulosic biofuel (million gallons)

33

123

230

n/a

Biomass-based diesel (billion gallons)

1.63

1.73 

1.90

2.00

Advanced biofuel (billion gallons) 

2.67

2.88

3.61

n/a

Renewable fuel (billion gallons)

16.28

16.93

18.11

n/a

 

 

 

 

Note: Units for all volumes are ethanol-equivalent, except for biomass-based diesel volumes, which are expressed as physical gallons.

The final rule also sets out revised compliance dates for refiners and other parties.

The National Corn Growers Association was not happy with EPA’s announcement. Chip Bowling, president of NCGA, issued a statement that claims the EPA’s reset of renewable fuels volumes will hurt rural America and should be challenged.

“In light of the EPA’s decision, we are evaluating our options. We will fight to protect the rights of farmers and consumers and hold the EPA accountable,” said Bowling.

He noted, “America’s corn farmers are proud to grow a cleaner burning, renewable fuel source for America and the world. In July, we asked the Environmental Protection Agency to restore the 2014-16 corn ethanol renewable volume obligation to comply with the Renewable Fuel Standard as passed by Congress and signed into law.

“While we are pleased to see the EPA take a step forward and revise its original proposal, the fact remains that any reduction in the statutory amount will have a negative impact on our economy, our energy security, and the environment. It is unfortunate that Big Oil’s campaign of misinformation continues to carry weight in the court of public opinion, and in this decision.”