The US Environmental Protection Agency (EPA) announced the 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 (earlier post), but still represents a reduction compared to the original statutory requirements.
|Final Renewable Fuel Volumes|
|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|
|All Renewable fuel (billion gallons)||16.28||16.93||18.11||n/a|
|(Units for all volumes are ethanol-equivalent, except for biomass-based diesel volumes which are expressed as physical gallons.)|
|Final Percentage Standards|
|All Renewable fuel||9.19%||9.52%||10.10%|
The final 2016 standard for cellulosic biofuel—the fuel with the lowest carbon emissions—is 230 million gallons, or about 7 times more than what the market produced in 2014. In June, EPA had proposed 206 million gallons. In the original legislation, the volume for 2016 was 4,250 million gallons.
The final 2016 standard for advanced biofuel is 3.61 billion gallons—35% higher than the actual 2014 volumes. In June, EPA had proposed 3.4 billion gallons; the original legislation called for 7.25 billion gallons of advanced biofuels by 2016.
Biodiesel standards grow steadily over the next several years, increasing every year to reach 2 billion gallons by 2017.
Under the final rule, the total required volume of all renewable fuels is 18.11 billion gallons—11% higher than 2014 actual volumes. In June, EPA had proposed a total of 17.4 billion gallons for all renewable fuels.
EPA said 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.
Chip Bowling, president of the National Corn Growers Association, said that while his group was pleased to see the upward revision, “the fact remains that any reduction in the statutory amount will have a negative impact on our economy, our energy security, and the environment.”
Brent Erickson, Executive Vice President of BIO’s Industrial & Environmental Section, was more blunt, saying:
Today’s rule is a severe blow to American consumers and the biofuels industry. To date, BIO member companies have invested billions of dollars to develop first-of-a-kind advanced and cellulosic biofuel production facilities. EPA’s two-year delay in finalizing the rule created untenable uncertainty and shook investor confidence in the RFS program. BIO estimates that investment in the advanced biofuel sector has experienced a $13.7 billion shortfall due to EPA’s delays and proposed changes. Unfortunately, this final rule exacerbates the problem.
EPA’s action will undoubtedly trigger Court challenges that prolong and aggravate uncertainty about this program. BIO, its members and allied groups are now considering their available legal options to remedy EPA’s violation of the Clean Air Act.
However, Elizabeth Farina, president of the Brazilian Sugarcane Industry Association (UNICA) was more sanguine about the changes:
UNICA is heartened by EPA’s recognition the RFS requirements for advanced biofuel can and should increase. Today’s decision appears to leave the door open for continued American access to sugarcane ethanol from Brazil, one of the cleanest and most commercially ready advanced biofuels available today.