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EPA finalizes new Renewable Fuel Standards

The US Environmental Protection Agency (EPA) issued a final rule under the Renewable Fuel Standard (RFS) program that establishes the biofuel volume requirements for 2023 to 2025. The final rule also discusses EPA’s intent to monitor the ongoing implementation of the RFS program and its impacts on domestic refineries.

The Set Rule establishes the biofuel volume requirements and associated percentage standards for cellulosic biofuel, biomass-based diesel (BBD), advanced biofuel, and total renewable fuel for 2023–2025. It also completes EPA’s response to a court remand of the 2016 annual rule by establishing a supplemental volume requirement of 250 million gallons of renewable fuel for 2023. The final volume targets are as follows:

Volume Targets (billion RINs)

  2023 2024 2025
Cellulosic biofuel 0.84 1.09 1.38
Biomass-based diesel 2.82 3.04 3.35
Advanced biofuel 5.94 6.54 7.33
Renewable fuel 20.94 21.54 22.33
Supplemental standard 0.25 n/a n/a

The Energy Independence and Security Act (EISA) of 2007 does not specify statutory volumes after 2022, and EPA in this rule is establishing final biofuel volume targets for all categories under the “set” authority provided by the Clean Air Act. When determining biofuel volumes for years after 2022, EPA must consider a variety of factors specified in the statute, including costs, air quality, climate change, implementation of the program to date, energy security, infrastructure issues, commodity prices, water quality, and supply.

EPA calculates that the final rule will reduce US oil imports by roughly 130,000 to 140,000 barrels of oil per day over the time frame of the final rule, 2023–2025.

In addition to setting the volume requirements, EPA is finalizing several regulatory changes intended to expand the use of biogas under the program while, at the same time, putting in place provisions that it says will improve the operation of the RFS program.

EPA continues to assess the comments received on proposed regulations governing the generation of Renewable Identification Numbers (RINs), which are RFS compliance credits, for electricity made from renewable biomass that is used for transportation fuel (eRINs). The EPA will continue to work on potential paths forward for the eRIN program, while further reviewing the comments received on the proposal and seeking additional input from stakeholders to inform potential next steps on the eRIN program.

In response, the Diesel Technology Forum (DTF) issued a statement from Executive Director Allen Schaeffer saying that the future volumes are “well below all expectations.”

It will delay the important opportunity for reducing greenhouse gas emissions from the use of low carbon biodiesel and renewable diesel fuels.

Biodiesel and renewable diesel fuel deliver significant carbon reductions in every application right now. These fuels can be used in any new, or existing, diesel engine. They’re endorsed by engine and equipment makers. Trucking fleets, farmers, contractors, and others use these fuels as an affordable way to help reduce greenhouse gas and other emissions by up to 80%. That’s immediately and without investments in new infrastructure, vehicles, or equipment.

The EPA’s volume set for 2023 is misaligned with current conditions. Compared to the same period in 2022, qualifying biomass-based diesel production increased by more than 30%, or 400 million gallons, in the first five months of this year already. The Energy Information Administration’s Short Term Energy Outlook for June 2023 projects increases in US production of biodiesel and renewable diesel of more than 800 million gallons this year and 900 million gallons next year.

The EPA’s small nudge in biofuel volumes at this time of otherwise progressive climate policies is as confusing as it is inconsistent. … Yet rather than issuing a robust and growth-oriented future volume set rule that expands the use of renewable diesel and biodiesel fuels to drive faster and deeper reductions in greenhouse gas emissions, the EPA touts it primarily as an energy security strategy to reduce 140,000 barrels of foreign oil imports.

—Allen Schaeffer

Clean Fuels Alliance America expressed extreme disappointment with the rule as well, noting that EPA finalized moderate increases in the biomass-based diesel and non-cellulosic advanced volumes each year but did not increase the overall renewable fuel market. EPA failed to change biomass-based diesel volumes for 2023 despite the rapid increase in US production of biodiesel, renewable diesel and sustainable aviation fuel during the first months of the year.

EPA is undercutting the certainty that our industry hoped for from a three-year RFS rule. U.S clean fuel producers, oilseed processors, fuel distributors and marketers have all made significant investments to grow the industry rapidly over the next several years. The industry responded to signals from the Biden administration and Congress aiming to rapidly decarbonize US fuel markets, particularly aviation, marine, and heavy-duty transport, and make clean fuels available to more consumers. The volumes EPA finalized today are not high enough to support those goals.

—Kurt Kovarik, Vice President of Federal Affairs with Clean Fuels


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