Promises in Bloom: The RVO Reset and Springtime for the Bioeconomy

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March 30, 2026

by Jim Lane (Biofuels Digest)  ...(T)he final “Set 2” Renewable Fuel Standard volume requirements for 2026 and 2027. Not a tweak. A reset.  After seasons of regulatory uncertainty and economic headwinds, President Donald Trump and EPA Administrator Lee Zeldin delivered what many across the heartland are calling a historic realignment—one that returns the program to its original intent: putting American farmers first, prioritizing homegrown fuels, and restoring forward motion to a system that had, at times, stalled.

In the twentieth year of the Renewable Fuel Standard, the new rule sets volumes at the highest levels in the program’s history. The EPA estimates more than $10 billion in economic impact for rural America and over 100,000 jobs created across agriculture and manufacturing. But numbers alone don’t tell the story. They move.

The Numbers That Move

The volumes arrive in full stride.

26.81 billion RINs in 2026. 27.02 billion in 2027. Not incremental growth—acceleration. Biomass-based diesel climbs to 9.07 billion RINs, then 9.20. Advanced biofuels stretch higher, to 11.10 and 11.32. Cellulosic, still the smallest stream, continues its steady advance—1.36 to 1.43. And anchoring it all: 15 billion gallons of conventional biofuel, held firm, a signal of continuity in a system that has not always offered it.

To meet these levels, biodiesel and renewable diesel production must rise more than 60 percent from 2025. The payoff: a projected reduction of roughly 300,000 barrels per day in foreign oil dependence.

This is not inventory. This is motion returning to the system.

From Moment to Memory

Policy moments come and go. Systems remember.

What matters now is whether this day becomes structure—plants restarted, capital returning, feedstocks flowing—or whether it remains what Washington sometimes produces best: a beautiful morning in a garden, remembered mostly for the speech.

Voices in the Garden

...

Across the industry, the response was immediate. Geoff Cooper of the Renewable Fuels Association pointed to long-sought clarity for producers and markets alike. Emily Skor emphasized the signal of durable commitment. Jed Bower called it certainty at a moment when certainty has been scarce. And for Chuck Grassley, who has carried this issue for decades, the moment carried the weight of memory—policy catching up, at last, with intent.

Three Structural Turns

But the real story isn’t just in the gallons.It’s in three structural turns—quiet revolutions embedded in the rule.

Act I: The SRE Reckoning
A 70 percent reallocation of small refinery exemptions restores nearly a billion RINs annually to the system—ensuring that obligations translate into actual blending, not accounting artifacts.

Act II: The Half-RIN Border
Beginning in 2028, foreign fuels and feedstocks receive half credit. A clear signal: domestic production takes priority, and the runway to scale it begins now.

Act III: Electricity Exits the Stage
Renewable electricity is formally removed from the RFS framework, returning the program to its statutory foundation—liquid and gaseous fuels, as originally intended.

Three moves. Each long debated. Each now decided.

A System Reawakens

Few sectors feel this shift more than biomass-based diesel. After a punishing 2025—plants idled, production down sharply—the new volumes offer something the industry has lacked: a pathway back. Producers are already signaling readiness to bring existing capacity—some 7 billion gallons—back into full use, potentially supplying more than 10 percent of U.S. diesel demand.

Looking to the Horizon

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There are still issues to resolve—regulatory refinements, market expansions, the continued push toward higher blends like E15—but the direction is unmistakable. The system is moving again.

The Garden, in Bloom

...

And today, something long sought has come back into view. So let us enjoy it—fully, gratefully, without hesitation. Not as skeptics peering too closely at the gift, but as participants in it, stewards of what comes next.  READ MORE

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Excerpt from Office of Senator Chuck Grassley (R-IA): “Four biodiesel plants in Iowa closed or idled after the Biden administration set RVOs too low. With today’s announcement, President Trump and Administrator Zeldin are bringing relief for Iowa farmers and biofuel producers and for every consumer who wants lower prices at the pump. Biofuels drive economic growth in rural communities and strengthen U.S. energy independence. That’s why I’m working so hard to get year-round, nationwide E15 enacted into permanent law,” Grassley said.

As part of the announcement, foreign fuels and feedstocks will receive half the RFS compliance value compared to American-made products starting in 2028. This gives domestic biofuel producers the ability to prepare for the change and benefit over foreign competition. Last year, Grassley led over 45 Senate and House colleagues in a letter urging EPA to finalize this policy.

EPA also announced it is finalizing a 70% partial reallocation of the 2023–2025 exempted RVOs for the 2026 and 2027 compliance years. This follows a push led by Grassley and U.S. Sen. Amy Klobuchar (D-Minn.) urging EPA to reallocate any gallons lost through the granting of small refinery exemptions (SREs). Strong reallocation ensures more RVOs are accounted for.

Background:

Since he helped establish the Renewable Fuel Standard (RFS) in the Energy Policy Act of 2005, Grassley has worked to ensure the executive branch implements the law as intended. Grassley also supported the Energy Independence Security Act of 2007, which included requirements for cellulosic ethanol and set a mandatory RFS requiring fuel producers to use at least 36 billion gallons of biofuel by 2022. Grassley pushed ensuing administrations to keep to this number.

In 2023, Grassley joined the No Fuel Credits for Batteries Act to nullify a proposed Biden-era E-RINS rule that props up the electric vehicle industry while devaluing incentives for ethanol and biodiesel expansion.

Grassley has consistently led bicameral efforts to raise RVOs, including for the 2024-2025 RVOs as well as for 2026 and beyondREAD MORE

 

Excerpt from Sustainable Advanced Biofuels Refiners Coalition/EIN Presswire:  SABR pushed EPA for years to correct renewable diesel’s EV, which unfairly disadvantaged biodiesel. With the new rule, the biodiesel market is set to stabilize.

SABR applauds EPA for this final rule, including its decision to correct inflated equivalence values. We also applaud EPA for increasing the RVOs and partially reallocating SREs.”  — Joe Jobe, CEO, Sustainable Advanced Biofuel Refiners (SABR) Coalition

The Sustainable Advanced Biofuel Refiners (SABR) Coalition, a national biodiesel trade association made up of over 70 organizational members throughout the biodiesel value chain, welcomed U.S. EPA’s final rule March 27 on renewable volume obligations (RVOs) for 2026 and 2027 under the federal Renewable Fuel Standard program.

“SABR applauds EPA for this final rule, including its decision to correct inflated equivalence values (EVs),” said SABR CEO Joe Jobe. “We also applaud EPA for increasing the RVOs and partially reallocating small refinery exemptions (SREs).”

SABR has been urging EPA to correct inflated EVs assigned to renewable diesel, sustainable aviation fuel (SAF) and their byproducts for several years (see this 2023 SABR article). In the agency’s 2023 proposed “Set” rule, EPA acknowledged that renewable diesel EVs were inflated, and that this is unfair to biodiesel. As a result, EPA proposed correcting them, but renewable diesel advocates argued against this, and the agency did not include a correction in the 2023 final rule.

At recent average D4 renewable identification number (RIN) credit prices of $1.60, the inflated EV for renewable diesel results in an improper advantage of 32 cents per gallon over biodiesel. It is one of the primary reasons that renewable diesel has been cannibalizing biodiesel over the past few years.

“We are very glad that EPA chose to correct the inflated values in this rulemaking,” Jobe said. “We are also glad to see that EPA addressed the inflated values for SAF and naphtha as well.”

The RFS was instrumental in the development of the U.S. biodiesel industry—America’s first advanced biofuel. In recent years, arbitrarily low RVOs and flawed policy signals have improperly disadvantaged biodiesel, the lowest-cost, lowest-carbon, and highest-performing fuel in its heavy-duty category. Today’s announcement takes some critically important steps toward addressing those flaws and getting the RFS back on track.

Several soybean organizations joined SABR in their comments to correct the inflated equivalence values. “SABR has been the leading voice to fix the inflated equivalence values,” said Ron Kindred, a soybean farmer from Atlanta, Illinois, who represents the Illinois Soybean Association on the SABR board. “This correction will help reduce some of the flawed policy disadvantages placed on biodiesel, and it will help soybean farmers by effectively adding more gallons to the program. We appreciate the positive changes EPA implemented with this rule. The increases in the biomass-based diesel category indicate that EPA is listening to stakeholders and working to provide clarity to markets.”

About the SABR Coalition
Sustainable Advanced Biofuel Refiners (SABR) is a coalition of stakeholders that have invested in building out America’s first advanced biofuel—biodiesel. Biodiesel is the most cost-effective means to reduce greenhouse gas (GHG) emissions from medium- and heavy-duty vehicles, providing numerous performance, economic, environmental and energy security benefits. It is produced from renewable resources such as soybean oil, used cooking oil and animal fats. SABR includes stakeholders from every link in the value chain from feedstock growers to biodiesel producers, distributors, retailers and consumers, as well as infrastructure, product and service providers. For more information, please visit sabrcoalition.org.   READ MORE

 

Excerpt from Brownfield Ag NewsA petroleum group says the EPA’s new biofuel blending requirements will cost consumers and taxpayers more. 

Geoff Cooper with the Renewable Fuels Association tells Brownfield that it isn’t the case. “There’s really no logical argument, no reasonable argument that the RFS is somehow raising fuel costs for consumers, and I think, you know, I think the administration understands that. Certainly, Congress understands that.”

In a recent statement, American Fuel and Petrochemical Manufacturers CEO Chet Thompson said the RFS already costs nearly 25-cents per gallon, and the EPA’s rule will add tens of billions more. 

Cooper says refiners falsely believe they have to buy Renewable Identification Numbers, or RIN credits, to comply with the RFS. 

But he says, “That isn’t true. You don’t have to buy a RIN credit from another refiner. You can buy biofuel. You can buy ethanol, you can buy renewable diesel, you can buy biodiesel, you can blend it with the refined product you’re making at your refinery. You can get that RIN credit for free by doing that.”

He says ethanol can be purchased for about $2.00 a gallon, which comes with the RIN credit, compared to about $3.15 a gallon for wholesale gasoline.

The EPA’s 2026 rule requires 26.81 billion gallons of total renewable fuel, and 27.02 billion gallons for 2027.

The American Fuel and Petrochemical Manufacturers say the new RVO requirements would cost Americans and refiners about $37 billion, or $770 per extra ethanol gallon.  The organization has not responded to Brownfield’s request for comment.  READ MORE

 

Excerpt from S&P Global:  Platts, part of S&P Global Energy, has updated its 2026 Renewable Volume Obligation weightings (RVOY026 and RVOR002) and the 2025 cellulosic weight (RVCY025) using the Environmental Protection Agency's finalized Renewable Fuel Standards for 2026, effective March 30, 2026.

The EPA released its finalized rule on March 27, 2026, and as per Platts methodology, RVO formulas may be updated when the EPA makes such changes.

As per Platts methodology, the renewable fuels are mandated by the EPA; they are subject to change without prior notice. When the EPA sets forth such changes, Platts will inform the market of any resulting changes to the assessment formulas through subscriber notes.

Prior to the final rule, Platts calculated the 2026 RVO using the 2025 Annual Energy Outlook and the proposed standards for 2026, assuming a 50% reallocation for small refinery exceptions, November Small Refinery Exemption and the updated adjustment factors. Platts launch note can be found here.

The EPA's latest RFS 2026 weightings are as follows:

Category Previous New
D6 8.98% 9.08%
D5 0.36% 0.39%
D4 4.21% 5.24%
D3 0.77% 0.79%

Therefore, Platts calculates the 2026 RVO in cents/gal using the following formula, considering new percentages:

RVO = 9.08 % (D6) + 0.39 % (D5) + 5.24% (D4) + 0.79 % (D3)

Platts has also updated the cellulosic biofuel percentage (D3) mandate for its calculated values of the US RVO for compliance year 2025 (RVOY025).

The update follows the EPA's partial waiver of the 2025 cellulosic biofuel volume requirement, published March 27, 2026.

The updated 2025 D3 percentage is 0.71%, down from the EPA's initially stated 0.81%.

Platts publishes current-year RVO (RVOR002) and 2025 RVO ( RVOY025 ) in the Platts Biofuelscan, LatinWire, USMarketWire, Fuel Ethanol Report and Biomass-Based Diesel Report.

Symbols also appear on Platts Alert pages PBF10, 201, 210, 301, and 310, and PGA, PFR 28, 164,165, 310, 330, 331, 350, 351, 410, 411, 430, 431, 450, 451, 481.

Please send all feedback, comments, or questions to platts_biofuels@spglobal.com and pricegroup@spglobal.com.

For written comments, please provide a clear indication if comments are not intended for publication by Platts for public viewing.

Platts will consider all comments received and will make comments not marked as confidential available upon request.  READ MORE

 

Excerpt from Brownfield Ag News:  A professor of agricultural economics with the University of Illinois says recently announced Renewable Volume Obligations (RVOs) from the U.S. EPA stand to dramatically impact domestic soybean demand.

Scott Irwin tells Brownfield, “We’re going to have another boom that is going to be driven by renewable diesel and biodiesel.”

Irwin says the EPA’s announced intentions to award only half credit for imported fuels and feedstocks beginning in 2028 is key.

“We’re going to get more domestic feedstock use than we would have because of the incentives and the 45-Z tax credit.”  He says, “You can only get the 45-Z tax credit if you use feedstock from North America.”

He expects full implementation could drive soybean prices 50 to 75 cents per bushel higher.

“That’s a big move, and I think it’s going to be responsible for us likely turning the corner and starting to crawl out of the cyclical lows for corn and soybean prices,” he says.

Irwin says the mix of domestic and foreign feedstocks used in 2026 and 2027 will determine the extent of price impact the RVOs will have on soybeans in the near term. READ MOREincludes AUDIO

 

Excerpt from AgWeb: Matt Upmeyer with Montana Renewables explains why it could spark major gains for U.S. agriculture.

...

“It sure feels like it,” says Matt Upmeyer, director of feedstock sourcing and strategy at Montana Renewables, when asked whether the policy signals the next biofuel boom. “We received a strong RVO, adding about 2 billion gallons of biomass-based diesel demand, and that’s a huge increase. And certainly feedstock demand is growing as well. That 2 billion of biomass-based diesel represents about 15 billion lb. of feedstock for the biodiesel and renewable diesel producers. And that really translates directly back to farm and agriculture growth as well.”

From Underperformance to Full Throttle

For an industry coming off a sharp downturn, where biodiesel production fell significantly in 2025 and facilities idled or slowed, the scale of the mandate is not just notable — it is corrective.

“I mean, I think it is realistic,” Upmeyer says of the aggressive growth targets. “The industry is poised to meet that demand. We’ve got capacity. The renewable industry, which is both biodiesel and renewable diesel, has a combined capacity of probably around 7 billion gallons. So meeting that mandate, I don’t think is a problem.”

But meeting it will require a fundamental reshuffling of how feedstocks move through the system.

“We will definitely see some changes and shifts in the feedstock flows,” he says. “We talked a little bit about the soybean oil increase and the production of soybean oil through crush. I think also you’re going to see the tallow industry and choice white grease, the hog industry, as well as poultry fat — all of those are going to find their way into the renewable diesel and biodiesel in a greater way. I think we’ll maximize all of the available low-CI feedstocks, including distillers corn oil. And then from there, obviously, the demand will be filled with soy.”

...

“I think that as we expand the amount of biomass-based diesel we produce, we’re going to start looking to other feedstocks as well. So canola, there’s a fair amount of canola grown in the United States, and certainly our neighbors to the north are large canola producers,” Upmeyer says. “I think that will become an integral part of what we do. And then there’s other low-CI feedstocks that are sort of on the cusp, things like camelina and different things like that will get attracted new attention right now to see how they may fit into the future mandates and production.”

...

“Biodiesel producers have a slightly different process than renewable diesel,” he says. “They take fats, oils and greases, combine them with methanol and catalysts to make biodiesel. And methanol costs have shot up, right? So I think the marginal producers on biodiesel are still probably not super inclined to start up, but certainly the integrated biodiesel plants will be running hard. And I do believe that even the marginal biodiesel players will get a chance to restart those assets in the near term.”

...

“We just couldn’t get our heads around the administrative burden that might be associated with a half-RIN,” Upmeyer says. “How do you account for feedstocks coming in from some Canadian origin, some domestic, some from foreign sources? So I think there was an administrative burden that was certainly problematic.”

“This is certainly in line with the administration’s desire to maintain energy independence in the U.S. and to have a U.S.-based and U.S.-centric market for our crop inputs and fuels,” he says. “So I think there were a lot of things that went into this. But at the end of the day, it’s still on the table for 2028. I don’t think there’s clear guidance yet, but it certainly left that door open to address this issue in the Set 3 rule.”

A Win for Agriculture

When asked if he would classify this is a “win for U.S. agriculture,” Upmeyer said the immediate impact of the record-high blending mandates for 2026 and 2027 is already clear to those closest to the supply chain.

“I think it’s a great win,” Upmeyer says. “Again, we’re really underpinning the demand for soybeans and crush. We’ve got a strong demand for the rendered products that come from the beef industry and hog industry. So, I think this is a win for agriculture and for the renewable fuels industry. We certainly applaud the administration’s commitment to energy independence, to the renewable space and ultimately to agriculture.” READ MORE; includes VIDEO

 

Excerpt from Chemical & Engineering News:  The Clean Air Act restricts the amount of ethanol that can be blended into gasoline during the summer to 10% in most cases, a provision in the 1970 law intended to cut smog by reducing the vapor pressure of gasoline. The EPA is empowered to issue emergency waivers, however, and has done so every summer since 2022. EPA administrator Lee Zeldin says in a press release that the E15 waiver will reduce the cost of gasoline and increase supply.

Even if the EPA’s rationale is economic, the move is sound from an air quality standpoint, says Joanne Ivancic, executive director of the nonprofit advocacy group Advanced Biofuels USA.

A 10% blend has a higher vapor pressure, meaning it evaporates more easily than pure gasoline does, and the law assumes that trend continues as more ethanol is added, Ivancic says. “However, the opposite is true. The potential smog problem actually decreases with higher ethanol blends.” Data from the National Renewable Energy Laboratory PDF, recently renamed the National Lab of the Rockies, show that the vapor pressure peaks at about 10% ethanol and curves steadily downward at higher concentrations.

The EPA also finalized the Renewable Fuel Standard (RFS) rules for 2026 and 2027, setting the renewable fuel blending requirements such that roughly 300,000 barrels of oil per day will be replaced by biofuels—an amount the agency says is the highest in program history. In a press release, Zeldin says the mandate “creates a larger, more stable, and more reliable domestic market for U.S. crops, strengthening farm income and rural economies.”

...

The American Coalition for Ethanol, an industry group, praises both actions but urges the federal government to go further. The organization says that Congress should act to make E15 permanently legal year-round and that the EPA should “seriously consider higher volumes next year” to make up for instability in the RFS in recent years. READ MORE

 

Excerpt from National Renewable Energy LaboratoryBlending of ethanol into gasoline at 10 volume percent causes the RVP to increase by about 1 psi despite the fact that fuel grade ethanol has a lower vapor pressure than gasoline (see Figure 1). The low vapor pressure of fuel grade ethanol is caused by attractive forces between the ethanol molecules.

...

When ethanol was first permitted as an additive in gasoline at concentrations of up to 10% in 1979, its effect on vapor pressure was not regulated.3 In 1992, new EPA regulations (40 CFR 80.27) provided a 1-psi waiver for ethanol blends that contained between 9 and 10 percent ethanol. Most, but not all, of the state-set RVP standards also allow a 1-psi waiver for blends of 9 to 10 percent ethanol.4,5 READ MORE

 

Excerpt from Engine Technology Forum: “Advanced engines and renewable fuels together provide a sustainable solution for power and mobility. Internal combustion engines are key to both producing our renewable and traditional fuels and to realizing their benefits in powering critical sectors of our economy. Biodiesel, renewable diesel, renewable natural gas, renewable propane, and ethanol already play a vital role in our nation’s transportation system and key industries. Thanks to this final action, that role will be expanded further in the future.

“This welcome action by EPA Administrator Zeldin replaces an era of stagnation and uncertainty with a new approach focused on growth and optimism for renewable fuels producers and users alike. Renewable biofuels are essential for powering our agriculture and transportation sectors today and in the future. These new volume requirements reinforce that renewable biofuels are a valuable part of America’s energy portfolio, contributing to our energy security and sustainability.   READ MORE

 

Excerpt from Inside Climate News: The U.S. doesn’t have enough bio-based diesel to meet the administration’s new mandate, so blenders will have to import yet more foreign crop-based oils.

...

“This particular rule, by EPA’s own analysis, will cost about $20 billion over the two years that it’s in effect,” said Dan Lashof, a senior fellow at the World Resources Institute. “And rather than having any environmental benefits, it will actually drive deforestation and increased emissions of heat-trapping carbon dioxide.”

The world’s vegetable oil markets are highly interlinked. If vegetable oil is diverted from food to fuel uses, oil for food will have to come from somewhere else, potentially regions where carbon-rich tropical forests are cleared to produce soybeans and palm oil. 

Jeremy Martin, a senior scientist at the Union of Concerned Scientists, says that bio-based diesel consumption in the U.S. has shot up in recent years. Imported vegetable oils and animal fats met about 70 percent of that demand.

...

“Increasing the use of vegetable oil for fuel has dramatic consequences for deforestation,” Martin said. “There’s not 60 percent more vegetable oil available in the United States for fuel, so if it’s going to increase that much, it’s going to have a dramatic impact on the balance of trade and that will lead the U.S. to import more vegetable oil.”

Paul Winters, a spokesman for Clean Fuels Alliance America, the country’s biggest biodiesel trade group, said the EPA examined Martin’s claim and “concluded that North American feedstock supplies are not a limiting factor in meeting the final RFS volumes.” 

“The strong U.S. market for biodiesel and renewable diesel is needed to ensure that farming – production of food, animal feed, and other agricultural goods – remains economically viable,” Winters added.

...

U.S. producers are currently sitting on a glut of unsold soybeans—largely because China, the largest buyer, has turned to Latin America in response to Trump’s trade tariffs last year. But it will take years to ramp up production capacity for turning those soybeans into oil. 

Palm oil, which is produced largely in Malaysia and Indonesia and used mostly for food and cosmetics, is not eligible under the U.S. Renewable Fuel Standard or in the European Union because its cultivation has led to so much deforestation.

“But because the rule would drive increased demand for soybean oil, it will drive up prices for all vegetable oils, which are highly correlated,” Lashof said. “The problem is that, in the meantime, other vegetable oils are being used to make biofuel, and then palm oil is used to backfill that oil in the food markets. … They’re very tightly linked as substitutes in the international market.”

The EU recently said that, as with palm oil, it would no longer allow soy-based biofuels to count toward its renewable fuel mandates because of the high risks they pose to deforestation and land-use conversion. In its evaluation of the new rule, EU regulators said “the expansion of the palm oil and soybeans production area into high-carbon stock land is so significant that the greenhouse gas emissions that result from land use change offset all greenhouse gas emission savings of fuels originating from this feedstock, when compared to the use of fossil fuels.”

The U.S. is going in the exact opposite direction.

Tim Searchinger, a researcher at Princeton University who has long questioned the emissions benefits of biofuels, called the new EPA mandates “very bad for the climate and nature.”

...

Winters, of Clean Fuels Alliance America, dismissed data behind indirect land use change. 

“Environmentalists who promote the theory of indirect land use change [ILUC] have been thoroughly unsuccessful in preventing deforestation over the past several decades,” Winters wrote in an email. “National and state-level policies to preserve existing forests are the only mechanism that will work. The level of uncertainty and unreliability in ILUC models is astounding and outcomes are entirely dependent on assumptions.”   READ MORE

 

Excerpt from National Law Review:  Key Takeaways

  • EPA’s final 2026–2027 RFS rule establishes the highest renewable volume obligations ever and raises volumes above the 2025 proposal, underscoring strong administration support for domestic biofuels, agricultural feedstocks, and renewable fuel production.
  • By reallocating 70% of Small Refinery Exemption (SRE) volumes from 2023–2025 into 2026–2027 obligations, EPA boosts future volumes and reduces the risk that previously exempt gallons undermine RIN demand.
  • EPA preserved its “America First” posture by deferring the 50% import-related renewable identification number (RIN) reduction until 2028, thereby maintaining a long-term policy signal that disfavors foreign fuels and feedstocks.
  • While EPA raised cellulosic volumes above proposed levels, RNG and biogas groups argue the final D3 targets still undershoot feasible production and could constrain sector growth.
  • Elimination of eRINs is likely to impact electricity-sector stakeholders that had anticipated benefits from an electricity pathway, particularly landfill gas producers, wastewater operators, and electric vehicles (EV) Original Equipment Manufacturers (OEMs), who have pushed for eRIN implementation rules for over a decade.  READ MORE

 

Excerpt from Inside EPA: EPA’s recent rule setting renewable fuel standard (RFS) blending volumes for 2026 and 2027 adopts a new rationale to maximize volumes and to justify a 70 percent “reallocation” of waived targets for small refiners to larger refiners, while also delaying controversial limits on imported biofuels and feedstocks until 2028 due to fuel price concerns. The “Set 2” rule, released March 27 , created historically high renewable volume obligations (RVOs), providing a boost for biofuels producers and the farm sector. While...  READ MORE

 

Excerpt from Inside EPA: EPA’s rule setting biofuel blending mandates for refiners under the renewable fuel standard (RFS) is seeking to shift emphasis away from the program’s statutorily mandated climate benefits. The agency also is finding the targets will result in substantial societal costs -- counter to typical Trump EPA policy. The “Set 2” rule , published in the Federal Register April 1, increased blending volumes for 2026 and 2027 for several classes of biofuels over 2025 levels, and it maintained the largest...  READ MORE

 

Excerpt from farmdoc daily:   In recent months, we analyzed proposed and anticipated RVO levels in a series of farmdoc daily articles (October 29, 2025November 5, 2025November 12, 2025November 24, 2025February 25, 2026).  The final rule delivers biomass-based diesel volume requirements close to but somewhat above our most recent projections, confirms the delay—rather than elimination—of the half-RIN import penalty until 2028 or later, and adopts 70 percent reallocation of 2023–2025 small refinery exemptions (SREs).  The purpose of this article is to review the final RVOs and compare them to our most recent projections.

...

Implications

The EPA’s final Set 2 rule delivers total applicable biomass-based diesel volumes of 9.07 billion RIN gallons in 2026 and 9.20 billion in 2027—the largest in the history of the RFS and nearly 70 percent above the 2025 applicable volume of 5.42 billion RIN gallons.  To put those numbers in historical perspective, the biomass-based diesel category has never been asked to grow by more than a few hundred million gallons in a single year.  Now the industry faces a ramp-up of over three billion RIN gallons in each of the next two years.  The sheer magnitude of this obligation makes the implementation of the final rule unlike anything the biomass-based diesel sector has previously confronted.  Taken together, the final Set 2 rule has set in motion forces that will reshape biomass-based diesel markets, feedstock supply chains, and biofuel trade patterns for at least the next several years.  These production, trade, and feedstock dynamics are the subjects we will turn to in our next several farmdoc daily articles in this series.

References

Gerveni, M., T. Hubbs and S. Irwin. "Overview of the U.S. Renewable Fuel Standard." farmdoc daily (13):90, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, May 17, 2023.

Hubbs, T. and S. Irwin. “Rewriting the RFS Playbook: Final RVOs for 2026–2027.” farmdoc daily (16):30, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, February 25, 2026.

Hubbs, T. and S. Irwin. “Rewriting the RFS Playbook: Revised RVOs Backload Projected Biomass-Based Diesel Production and Feedstock Use into 2027.” farmdoc daily (15):217, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, November 24, 2025.

Hubbs, T. and S. Irwin. “Rewriting the RFS Playbook: The Impact of Revised RVOs on Projected Biomass-Based Diesel Production and Feedstock Use for 2026–2027.” farmdoc daily (15):209, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, November 12, 2025.

Hubbs, T. and S. Irwin. “Rewriting the RFS Playbook: The Impact of Revised RVOs on Projected D4 Biomass-Based Diesel RIN Generation for 2026–2027.” farmdoc daily (15):204, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, November 5, 2025.

Hubbs, T. and S. Irwin. “Rewriting the RFS Playbook: The Impact of Recent EPA Decisions on 2023–2027 RVOs for Biomass-Based Diesel.” farmdoc daily (15):199, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, October 29, 2025.

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to Hydrocarbon Conversion (DSHC) direct-to-fuel directed evolution dispense distillates distillation distilled biodiesel distilled palm methyl ester (DPME) distilleries distributed/centralized distribution distribution capacity distribution waiver diversification divestment DME/rDME (dimethyl ether)/renewable DME DMF (2.5-dimethylfuran) Dominican Republic double cropping drawdown Drones/Unmanned Aerial Vehicles (UAV) drop-in biofuels/hydrocarbons drought drought tolerant drought-resistant dry ice dual cropping dual-fuel/flex fuel ships Dubai duckweed e e-diesel e-LNG (synthetic/electro Liquified Natural Gas) e-methanol e-NG (synthetic natural gas) E. coli E0 E0 price E1 E10 E10 certification fuel E10 price E100 E100 conversion kit E10M90 ethanol/methanol E11 E12 E13 E15 E15 price E15 pumps E2 E20 E20 price E20 pumps E22 E25 E25 pumps E27 E3 E30 E30 capable E30 certification fuel E30 optimized E30 price E30 pumps E32 E35 E4 E40 E40 conversion kit E40 pumps E5 E5 price E50 E55 E6 E7 E70 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