EPA proposes quotas for renewable fuel, biomass-based diesel
The US Environmental Protection Agency has proposed quotas for most biofuels for 2019 and a quota for biomass-based diesel for 2020 on June 26. “Conventional” renewable fuel volumes, primarily met by corn ethanol, would be maintained at the implied 15 billion-gal target Congress has set for 2019, EPA said.
The proposed quotas drew harsh criticism from the Renewable Fuels Association and the American Fuel & Petrochemicals Association, while the American Petroleum Institute’s response was somewhat more measured.
“EPA made the right call in not reallocating the waived small refiner exemption volumes,” API Downstream Group Director Frank Macchiarola said. “However, the agency’s proposal for 2019 is yet another example—in fact it’s an annual example—of a broken government program that needs a comprehensive legislative solution that includes the sunset of the program.”
“While we acknowledge that the implied 15 billion-gal requirement for conventional biofuels like corn ethanol should, in theory, send a positive signal to the market, it comes with the backdrop of 1.6 billion gal of demand destroyed by illegal waivers to small refineries and no commitment that EPA is changing its approach to granting these exemptions,” said RFA Pres. Bob Dineen.
“EPA proposed to double-down on the most failed parts of the Renewable Fuel Standard (RFS),” said AFPM Pres. Chet Thompson. “Higher cellulosic and biodiesel volumes that are not connected to reality could compound problems for consumers and refiners and continue the legacy of RFS dependence on expensive biodiesel imports. The RFS is a broken mandate, and US manufacturers, refiners, and consumers are paying the price. Congress must reform this program.”
The Fueling American Jobs Coalition (FAJC), meanwhile, said EPA adhered to precedent while making progress on pushing forward much-needed Renewable Identification Number market reforms. “As the EPA accurately assessed, blending volumes have shown no evidence of backtracking to date despite the unsupported claims of ethanol activists,” the group said.
It also expressed appreciation for what it saw as EPA’s acknowledgement that appropriate action on small refiner exemptions (SRE) is a statutory obligation under the Clean Air Act.
“If the ethanol industry would like to open the RFS to reform in a comprehensive way, we are confident that many parties—fuel makers, environmentalists, consumer groups, and others—would be very happy to join in,” FAJC said. “Frankly, clarifying the SRE program is the least of the problems with the RFS. Making it more sensitive to the current realities of the fuel market would be a much better place to start.”
Contact Nick Snow at [email protected].
Nick Snow
NICK SNOW covered oil and gas in Washington for more than 30 years. He worked in several capacities for The Oil Daily and was founding editor of Petroleum Finance Week before joining OGJ as its Washington correspondent in September 2005 and becoming its full-time Washington editor in October 2007. He retired from OGJ in January 2020.
