EPA proposes decreased renewable fuel volume obligations for 2018

The U.S. Environmental Protection Agency (EPA), Washington, signed a proposed rule setting the minimum amount of renewable fuels that must be supplied to the market 2018 under the Renewable Fuel Standards (RFS) program.  The action is designed to propose volume requirements and associated percentage standards that maintain renewable fuel volumes at levels comparable to the 2017 standards, recognizing limits to the growth of cellulosic and advanced biofuels. 

EPA is on track to meet the Nov. 30 statutory deadline to make the proposed renewable volume obligations (RVOs) final. The proposed volumes are based on requirements under the law and an analysis of current market dynamics, including energy demand, biofuel production and market constraints. 

Proposed and final renewable fuel volume requirements:

“Increased fuel security is an important component of the path toward American energy dominance,” says EPA Administrator Scott Pruitt. “We are proposing new volumes consistent with market realities focused on actual production and consumer demand while being cognizant of the challenges that exist in bringing advanced biofuels into the marketplace. Timely implementation provides certainty to American refiners, the agriculture community and broader fuels industry, all of which play an important role in the RFS program."

Some key elements of the action include:

• nonadvanced or “conventional” renewable fuel volumes are maintained at the 15-billion gallon target set by Congress;
• the biomass-based diesel standard for 2019 would be maintained at the 2018 levels of 2.1 billion gallons; and
• EPA is beginning technical analysis that will inform a future rule to reset the statutory volumes for cellulosic, advanced and total biofuels. The law requires this reset when certain conditions are met.

EPA is also taking comment on addressing concerns that some RFS obligations are increasingly met with imported fuel from Brazil, Argentina and Indonesia. Additionally, the agency says it is assessing higher levels of ethanol-free gasoline and bolstering an existing memorandum of understanding with the U.S. Commodity Futures Trading Commission (CFTC) to analyze and address a host of market concerns, including the need for increased transparency.