Advanced BioFuels USA

Proposed Renewable Fuel Standards for 2023, 2024, and 2025 Public Comments Due February 10, 2023

(U.S. Environmental Protection Agency) On December 1, 2022, EPA announces a proposed rule to establish required Renewable Fuel Standard (RFS) volumes and percentage standards for 2023, 2024, and 2025, as well as to propose a series of important modifications to strengthen and expand the RFS program. The proposed volume targets and percentage standards are listed below.

Proposed Volume Targets (billion RINs)^a
	2023	2024	2025
Cellulosic biofuel	0.72	1.42	2.13
Biomass-based diesel	2.82	2.89	2.95
Advanced biofuel	5.82	6.62	7.43
Renewable fuel	20.82	21.87	22.68
Supplemental standard	0.25	n/a	n/a

^a One RIN is equivalent to one ethanol-equivalent gallon of renewable fuel.

Proposed Percentage Standards
	2023	2024	2025
Cellulosic biofuel	0.41%	0.82%	1.23%
Biomass-based diesel	2.54%	2.60%	2.67%
Advanced biofuel	3.33%	3.80%	4.28%
Renewable fuel	11.92%	12.55%	13.05%
Supplemental standard	0.14%	n/a	n/a

Additionally, the proposed rule includes regulatory changes to prescribe how RINs from renewable electricity (eRINs) would be implemented and managed under the RFS program. This update to the RFS program would allow parties to register with EPA and generate eRINs produced from qualifying renewable biomass used as transportation fuel.

Minor regulatory changes including updates to third-party oversight review and other changes are also included in the proposed rule.

Public Hearing

EPA will hold a virtual public hearing on January 10, 2023, for the proposed rule. An additional session will be held on January 11, 2023, if necessary, to accommodate the number of testifiers that sign-up to testify. This hearing will be held virtually-only using Zoom (i.e., there will be no in-person hearing).

In order to attend the virtual public hearing, all attendees (including those who will not be presenting verbal testimony) must register by sending an email to RFS-Hearing@epa.gov. A separate registration form must be submitted for each person attending the hearing. Please register no later than January 3, 2023.

In order to allow everyone to be heard, EPA is limiting verbal testimony to three minutes per person. Speakers will not be able to share graphics via the virtual public hearing. Speakers will be able to request an approximate speaking time as part of the registration process, with preferences considered on a first-come, first-served basis.

If you have further questions or special needs, please contact Nick Parsons at RFS-Hearing@epa.gov.

Public Hearing Notice (pdf) (89.83 KB, 2022-12-01) (pre-publication, signed November 30, 2022)

Additional Resources

Proposed Rule (pdf) (2.78 MB, 2022-12-01) (pre-publication, signed November 30, 2022)
Draft Regulatory Impact Analysis (pdf) (13.97 MB, 2022-12-01) (November 2022, EPA-420-D-22-003)

EPA Takes Next Steps in Renewable Fuel Standard Program for 2023-25 — Proposal Seeks Public Input on Program’s Role in U.S. Energy Security, Economy and Environment (Environmental Protection Agency)

RFA: Proposal for 2023-2025 RFS Volumes Creates Pathway for Sustainable Growth (Renewable Fuels Association)

EPA advances biomass for EVs, pushes increase in biofuels (E&E News)

Clean Fuels Says RFS Proposal for 2023 and Beyond Woefully Underestimates Biomass-based Diesel (Clean Fuels Alliance America)

MN BIO-FUELS STATEMENT ON EPA’S PROPOSED RFS VOLUMES FOR 2023, 2024 AND 2025 (Minnesota Bio-Fuels Association)

EVs injected into biofuel policy fight (Politico’s Power Switch)

EPA seeks to mandate more use of ethanol and other biofuels (Associated Press)

EPA proposes higher biofuel blending volumes (Farm Progress)

U.S. EPA proposes revamp of biofuel program to include electric vehicles (Reuters)

US EPA proposes higher biofuel blending mandates for next three years (S&P Global)

EPA targets path for electric vehicles in reset of renewable fuel program — The shift could provide a new incentive for electric vehicles, but is drawing criticism from multiple groups. (Politico Pro)

Energy & Environment — EPA updates fuel blend proposal (The Hill)

RFA CEO Discusses EPA Proposal (AgNewsWire; includes AUDIO)

EPA aims to grow biofuels usage in latest RFS programme (Biofuels International)

House Agriculture Committee Chairman David Scott Statement on EPA Announcement on RVOs (U.S. House of Representatives Agriculture Committee)

EPA proposes more biofuel blending in nation’s gasoline — Minnesota’s farm groups cheered the proposed rule that would set volumes for how much biofuel must be mixed with petroleum until 2025. (Star Tribune)

WITH EYE ON SECOND-GENERATION BIOFUELS, EPA PROPOSES 10% INCREASE IN RFS (Successful Farming)

EPA releases Renewable Fuels Standards for 2023 through 2025 (RFD TV)

EPA announces new biofuel blending mandate proposal (The Hill)

EPA proposes adding power for electric vehicles to ethanol, biodiesel mandate (Des Moines Register)

EPA’s RFS ‘Set’ Seeks Steady Growth Of Biofuel Volumes For Three Years (Inside EPA)

Geoff Cooper on RFS: This is really good for the ethanol industry (RFD TV; includes VIDEO)

EPA proposes RFS volumes for 2023-2025 with modest boost for conventional ethanol (DRG News; includes AUDIO)

Senator Baldwin hails EPA for building upon clean energy (WEAU)

Kansas Corn welcomes EPA’s ethanol volume announcement (Morning Ag Clips)

EPA aims to grow biofuels usage in latest RFS programme (Biofuels International)

Excerpt from Renewable Fuels Association: Today’s proposal from the U.S. Environmental Protection Agency for 2023-2025 Renewable Fuel Standard volumes creates a clear pathway for sustainable growth in the production and use of low-carbon renewable fuels, according to the Renewable Fuels Association.

“EPA’s proposed rule solidifies a role for the Renewable Fuel Standard in future efforts to reduce carbon emissions and enhance our nation’s energy security,” said RFA President and CEO Geoff Cooper. “Once finalized, this rule will significantly accelerate growth and investment in the low-carbon renewable fuels that will help decarbonize our nation’s transportation sector, extend domestic fuel supplies, and bolster the rural economy. By including three years’ worth of RFS volumes, EPA’s proposed rule will finally provide certainty and stability for the entire supply chain. EPA Administrator Michael Regan put the RFS program back on track with the 2022 volume obligations, and today’s proposal builds upon that solid foundation. RFA thanks Administrator Regan and the Biden administration for continuing to make good on their commitment to grow the marketplace for lower-carbon, lower-cost renewable fuels.”

…

Cooper noted that these renewable volume obligations also would stimulate rapid growth in E15 and E85, making it that much more important that a resolution is found for allowing year-round sales of E15, especially with new legislation filed this week with the support of RFA, the American Petroleum Institute and others. READ MORE

Excerpt from E&E News: The proposal also includes a long-anticipated provision allowing for electricity generated through biomass to qualify for renewable fuel credits — called eRINs — if it’s used to power electric vehicles. That provision would become effective on Jan. 1, 2024, allowing time for regulated parties to register, EPA said.

Including the eRINs makes the projections for cellulosic ethanol particularly uncertain, the agency said, since those are feedstocks that would be used for the purpose.

“While the production of liquid cellulosic biofuel has remained limited in recent years,” EPA said, “the inclusion of eRINs into the program affords another opportunity for dramatic growth of cellulosic biofuel.”

The eRINs could also complicate matters for the biogas industry, exapanding that commodity’s use for electricity while taking away incentives to use biogas for vehicles that run on liquefied natural gas or compressed natural gas. READ MORE

Excerpt from Clean Fuels Alliance America: Proposed volumes are below existing production, undercutting investments in new capacity — Today, Clean Fuels Alliance America criticized the Environmental Protection Agency’s proposed Renewable Fuel Standard volumes for 2023 and beyond for undercutting investments in biodiesel and renewable diesel capacity. The minor increases for biomass-based diesel volumes in 2023, 2024 and 2025 are below the industry’s existing production and ignore the clean fuels industry’s significant investments in new capacity. The volumes provide no additional space for sustainable aviation fuel and short-circuit the nation’s goals to cut carbon emissions.

“EPA’s overdue set proposal significantly undercounts existing biomass-based diesel production and fails to provide growth for investments the industry has already made in additional capacity, including for sustainable aviation fuel. The volumes EPA is proposing for 2023, 2024 and 2025 ignore the more than 3 billion gallons currently in the market and fail to take into account the planned growth of the clean fuels sector,” said Clean Fuels Vice President of Federal Affairs Kurt Kovarik.

EPA’s data from the RFS program show that the U.S. market reached 3.1 billion gallons of biomass-based diesel in 2021 and already 2.9 billion gallons through October 2022, with two months still to go. The Energy Information Administration’s Short Term Energy Outlook, which informs EPA’s decisions on annual RFS volumes, currently projects a 500-million-gallon increase in biodiesel and renewable diesel consumption for 2023. EIA has also projected 2.4. billion gallons of added renewable diesel capacity coming online by 2024 and calculated another 1.8 billion gallons in announced planned capacity.

“The biodiesel and renewable diesel industry has already made considerable investments in production capacity and distribution infrastructure that will come online by 2025. The soybean and canola industries have invested more than $4 billion to bring additional feedstock capacity online over the next several years,” Kovarik continued. “EPA’s proposed biomass-based diesel volumes undercut those investments.”

EPA’s proposed biomass-based diesel volumes for 2023 and beyond:

(billion gallons)	2023	Growth from 2022	2024	Growth from 2023	2025	Growth from 2024
Biomass-based diesel	2.82	0.06	2.89	0.07	2.95	0.06

Clean Fuels appreciates EPA’s final rule creating a pathway to produce renewable diesel, jet fuel, heating oil, naphtha, and liquefied petroleum gas (LPG) from canola oil, which will generate even more biomass-based diesel and advanced biofuel gallons for the program. The approval enables a more diverse feedstock supply for the clean fuels industry. But the potential growth is not accounted for in the proposed volumes.

Clean Fuels supports EPA’s proposed alternative compliance method to document points of origin for used cooking oil supplies under separated food waste plans. This method will allow small producers to continue using a low-carbon feedstock and rely on documentation from used cooking oil aggregators.

“The clean fuels industry is meeting and exceeding all of the statutory factors that EPA is supposed to consider when setting volumes,” Kovarik added. “Our industry’s growth can generate new jobs and increase economic opportunities for growers, fuel producers and other economic sectors. Increasing production of clean fuels improves U.S. energy security, lowers diesel fuel prices, and generates carbon and emission reductions today that are necessary to meet future national environmental goals.”

Recently, Clean Fuels published a new study, “Economic Impact of Biodiesel on the U.S. Economy 2022,” conducted by LMC International. The study finds that based on 2021 market data, the biodiesel and renewable diesel industry produced 3.1 billion gallons and generated $23.2 billion in economic activity, while supporting 75,200 jobs paying $3.6 billion in annual wages in the United States. For every 100-million-gallon increase in domestic clean fuel production, the direct, indirect and induced economic activity increases by $1.09 billion and U.S. jobs grow by 3,185. The largest economic and employment benefits occurred in the farming, oilseed processing, and fuel production sectors.

The study further calculates that producing 6 billion gallons of clean fuels in the United States would increase overall economic activity from the current $23.2 billion to $61.6 billion and support 187,003 jobs earning $8.8 billion in wages. The construction of additional capacity would increase economic activity by an added $4.3 billion and support an additional 144,500 related temporary jobs earning $5.8 billion in wages.

When setting RFS volumes, EPA must consider the infrastructure and rate of future commercial production for advanced biofuels like biodiesel, renewable diesel and SAF. According to the Energy Information Administration, biodiesel and renewable diesel capacity is already 750 million gallons higher in 2022 compared 2021. EIA’s Short Term Energy Outlook projects availability of 3.9 billion gallons of biodiesel and renewable diesel in 2023. Further, USDA’s successful Higher Blends Infrastructure Incentive Program has already supported infrastructure investments for an additional 1 billion gallons of biodiesel. Congress has made a strong commitment to continue infrastructure grants through 2030. READ MORE

U.S. Senators Introduce Bill to Expand E15 Gasoline Sales, with Support from Oil Group

by Stephanie Kelly (Reuters) U.S. senators from Nebraska and Minnesota introduced legislation on Tuesday that would expand nationwide sales of E15, a gasoline with a higher blend of ethanol, after gaining support for the bill from an oil industry trade group for the first time, Senator Deb Fischer from Nebraska told Reuters.

The legislation, introduced by Fischer and Senator Amy Klobuchar from Minnesota and supported by the American Petroleum Institute (API), would mark a huge win for the ethanol industry and corn farmers who have repeatedly tried to expand sales of E15 but have faced hurdles.

While it is unknown if the bill has the support it needs to pass both the House and Senate to become law, the backing of the oil industry has lifted a notable political obstacle.

U.S. Environmental Protection Agency (EPA) anti-smog regulations currently restrict summertime sales of E15, even though research has shown the higher percentage blend may not increase smog relative to the 10% blend called E10 that is now sold year-round.

…

“By allowing for the year-round sale of E15 nationwide while also preserving access to lower ethanol gasoline blends, this bipartisan legislation strengthens the reliability of the fuel supply chain and ensures American consumers have access to the fuels they depend on every day,” said Will Hupman, API’s vice president of downstream policy.

The legislation also has the support of Senator Kevin Cramer from North Dakota, a co-sponsor of the bill. Cramer’s support is significant, as North Dakota is one of the top oil-producing states, Fischer said.

Organizations including the API, the Renewable Fuels Association (RFA) and the National Farmers Union wrote to congressional leaders this month to urge them to adopt legislation to expand nationwide E15 sales. read more READ MORE

RFA Welcomes Legislation Providing Year-Round E15 Availability (Renewable Fuels Association)

Bipartisan Senate bill would allow for summer E15 sales (AgriPulse)

How the oil sector came to embrace E15 after years of opposition (Houston Chronicle)

Senators Introduce Year-Round E15 Bill — Senators Scramble to Bring Back E15 Year-Round Sales in Lame-Duck Session (DTN Progressive Farmer)

US oil group backs bill allowing year-round E15 (Argus Media)

Bipartisan biofuel supporters float year-round E15 bill — Midwestern senators introduced a bill to make the higher-ethanol blend available year-round nationwide, superseding a regional proposal by several states. (E&E News/Politico Pro)

Fischer introduces bill to ensure year-round availability of E15 (Ethanol Producer Magazine)

Fischer Introduces Year-Round E15 Legislation with Landmark Support (Office of U.S. Senator Deb Fischer (R-Neb.))

Refinery-state Democrats plan bill to rein in biofuel blending compliance costs (Washington Examiner)

NEFU SAYS ALL AROUND APPROACH IS NEEDED TO BOOST ETHANOL WITH RFS, LEGISLATION (Brownfield Ag News)

Fischer, Klobuchar introduce year-round E15 legislation (High Plains Journal)

GRASSLEY SAYS E15 BILL MAY GET PUSHED TO NEW CONGRESS (Brownfield Ag News)

Over 250 Organizations, Companies Call for Quick Senate Passage of Year-Round E15 Bill (Renewable Fuels Association)

Year-round E15 legislation with landmark support comes into force (Biofuels International)

Excerpt from Renewable Fuels Association: Specifically, the legislation would harmonize fuel volatility regulations for ethanol-blended fuels across the country, allowing for the year-round sale of E15 in conventional gasoline markets. The legislation would supersede an effort by eight Midwest state governors to make regulatory changes that would assure the availability of E15 sales year-round in their states.

Additional bill co-sponsors, listed alphabetically, include Sens. Tammy Baldwin (D-WI), Sherrod Brown (D-OH), Kevin Cramer (R-ND), Tammy Duckworth (D-IL), Dick Durbin (D-IL), Joni Ernst (R-IA), Chuck Grassley (R-IA), Roger Marshall (R-KS), Jerry Moran (R-KS), Mike Rounds (R-SD), Ben Sasse (R-NE), Tina Smith (D-MN) and John Thune (R-SD).

Last week, RFA and the American Petroleum Institute led a broad coalition of energy and agriculture organizations that called on Congress to quickly adopt legislation, like the bill introduced today, that would permanently resolve inconsistent fuel volatility regulations.

“Due to the current policy, it is extremely difficult for many fuel marketers and retailers that may desire to offer E15 to their customers in the summer months to source that product,” the letter stated. “Our groups have come together—for the first time ever—to support legislation that would resolve this issue once and for all. … We urge Congress to act quickly to adopt legislation that will bring certainty and consistency to the fuel market, while also finally resolving long-standing differences among many stakeholders about fuel volatility regulations.”

In addition to RFA and API, the letter was signed by the American Farm Bureau Federation, Association of Equipment Manufacturers, Growth Energy, National Association of Convenience Stores, National Corn Growers Association, National Council of Farmer Cooperatives, National Farmers Union, National Sorghum Producers, NATSO, representing truck stops and travel plazas, and SIGMA: America’s Leading Fuel Marketers.

RFA estimates that nearly 97 percent of registered vehicles on the road today are legally approved by the U.S. Environmental Protection Agency to use E15, and the vast majority also carry the manufacturer’s endorsement to use E15. Recent analyses by RFA and the U.S. Energy Information Administration confirm that expanded use of E15 provided meaningful consumer savings at the pump last summer, as war in Ukraine pushed crude oil and gasoline prices to historic highs. A new survey released by CSP found that one out of every five fuel retailers plan to add the E15 blend at their locations in the coming year; more than 2,800 fuel stations currently carry the blend. READ MORE

Excerpt from Houston Chronicle: The shift in attitude within the oil sector comes as biofuels becomes an increasingly large part of their business, and companies seek to take advantage of subsidies for low-carbon fuels in states such as California and Oregon.

Companies including San Antonio-based Valero and Houston-based Phillips 66 have converted oil refineries to renewable diesel, which is made mostly from vegetable oil. By 2025 renewable fuel output is expected to double in the United States to 238,000 barrels a day, according to analysis by the research firm Energy Intelligence.

And oil companies’ obligation to blend biofuels into the fuel supply under the federal Renewable Fuel Standard is also increasing, as the Biden administration eliminates exemptions for small refineries. READ MORE

Excerpt from Washington Examiner: Congressional lawmakers are drawing up legislation to cut down the near-record compliance costs associated with the Renewable Fuel Standard, which has pitted corn staters and some in the oil industry against each other for more than a decade.

The bicameral effort would seek to control the volatile prices of Renewable Identification Numbers, according to an announcement Friday from the office of Sen. Bob Casey (D-PA). Refiners must blend a specified amount of biofuels, to which RINs are attached, into their fuel products in a given year. They may also purchase RINs as credits in lieu of blending the volumes, a common strategy especially among small refiners.

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The announcement follows the EPA’s release on Thursday of its proposed renewable fuel blending requirements for years 2023-2025, which would raise the volume of ethanol and other biofuels to new highs. READ MORE

QUOTE OF THE WEEK — California Air Resources Board

“Without biofuels, California tailpipe fossil CO2 would be 15 MMT higher in 2020.” California Air Resources Board in its annual statewide greenhouse gas (GHG) emission inventory READ MORE

Metacon Signs MOU with Abwasserverband Kempten

(Bioenergy Insight) Metacon has signed a Memorandum of Understanding (MoU) with Abwasserverband Kempten (Allgäu) (“AVKE”), based in Kempten, Germany regarding