While in Iowa, Administrator Zeldin Proposes 100% Reallocation for Additional 2025 Small Refinery Exemption Volumes and Opens Markets for American Farmers Public Comments DEADLINE December 4, 2026

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October 15, 2026

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(U.S. Environmental Protection Agency) While in Peosta, Iowa, U.S. Environmental Protection Agency (EPA) Administrator Lee Zeldin announced revisions to the Renewable Fuel Standard (RFS) “Set 2” rule volumes to keep the historic and necessary volumes intact and increase target markets for American farmers. In response to the higher than projected 2025 small refinery exemption (SRE) decisions and the needs of American farmers, the agency is proposing two options for revisions, both of which would reallocate 100% of the difference between projected and actual exempted volumes for 2025 SREs.

The Trump EPA understands the importance of providing a predictable and stable market for farmers, refiners, and American consumers to both maintain economic competitiveness and keep energy prices low. The proposal reflects the Trump Administration’s commitment to ensuring America’s hardworking farmers continue to have a robust and growing market for their crops, while also unleashing American energy.

“In each action taken, EPA works to deliver for all Americans. From our farmers to our energy workers, each has an important role to play in growing our economy and ensuring America’s energy independence,” said EPA Administrator Zeldin. “As soon as we got into office, American farmers asked the Trump EPA not to give them handouts but create avenues for them to enter additional markets. As our farmers continue to harvest their crops, today’s proposal is working to maintain a strong and durable market for them to sell to.”

“American biofuel producers have stepped up to the plate to provide record production, helping to fuel our nation and provide more market opportunities for our farmers. I’m thrilled to see Administrator Zeldin act on this growing momentum and provide a path forward to 100% reallocation by 2027,” said U.S. Secretary of Agriculture Brooke L. Rollins. “The American biofuel industry provides over $100 billion in economic activity and supports over 100,000 American jobs while helping to deliver on President Trump’s energy dominance agenda. The Trump Administration will continue to stand by and deliver results for our farmers.”

“The Trump administration is carrying through on its promise to support Iowa family farmers and biofuel producers. I worked closely with the White House, along with Sen. Ernst and Reps. Hinson, Miller-Meeks, Nunn and Feenstra, to secure full reallocation for all exempted biofuels, and I appreciate the Trump administration following through in a timely fashion. Today’s decision is a major boost for Iowa’s rural economy and the 31,000 Iowa jobs that biofuels directly employ,” said Senator Chuck Grassley (R-IA).

“As farmers continue to harvest their crops across Iowa, we must reaffirm our commitment in providing certainty and reliable markets,” said Senator Joni Ernst (R-IA). “Reallocating the waived small refinery exemption volumes into the 2026 and 2027 Renewable Volume Obligations will strengthen our farm economy, bolster domestic markets, and lower prices for consumers. I thank President Trump and Administrator Zeldin for taking this important step to put farmers first and ensure they have the resources needed to succeed.”

“Farmers across Southeast Iowa are feeling the squeeze, and they need a market they can count on. I’ve worked to make this a reality because Iowa farmers deserve reliable markets for the crops they grow. This announcement helps deliver on that goal, creating more demand for Iowa corn and soybeans,” said Representative Mariannette Miller-Meeks (R-IA-01). “I’m grateful to Administrator Zeldin and President Trump for following through, and I will always fight to put Iowa farmers first.”

“Biofuels should be front and center in any plan to unleash domestic energy production and lower costs at the pump. Earlier this year, the administration announced the strongest biofuels blending targets in history, driving demand for Iowa ag products and new investment in our rural communities,” said Representative Ashley Hinson (R-IA-02). “Today’s proposal reflects the 100% reallocation agreement I helped secure in August—making sure refinery exemptions don’t reduce demand for homegrown biofuels and our farmers and producers are made whole. With farmers facing such difficult conditions right now, getting this across the finish line is a big deal. I’m grateful to Administrator Zeldin for working with me to protect the Renewable Fuel Standard, and I’ll keep pushing relentlessly for Iowa farmers and biofuels producers throughout this process.”

“Homegrown ethanol and biodiesel help us drive down the price of fuel at the pump for families and boost demand for what we grow in Iowa. Our farmers and biofuel producers built this market, and I fought to protect it because it keeps more of that fuel flowing to drivers and keeps the demand with Iowa farmers instead of foreign oil producers. I’ll keep working with Administrator Zeldin to get this rule finalized so families and farmers get the certainty they deserve,” said Representative Zach Nunn (R-IA-03).

When EPA promulgated the “Set 2” rule, the agency estimated the volume of hardship exemptions that small refineries would receive for their 2025 renewable fuel obligations. The August 31,2026, SRE decisions for those 2025 obligations exceeded EPA’s expectations, and an additional 770 million renewable identification numbers (RINs) worth of renewable fuels were exempted from RFS obligations. EPA is now proposing to fully reallocate this volume, to ensure farmers maintain and increase access to their markets. The agency recognizes the importance of getting stakeholder input on the best approach to do so. Therefore, EPA is seeking public comment on two proposed approaches:

Proposed approach one: EPA would divide the additional 2025 SRE volume equally between the 2026 and 2027 compliance years.
Proposed approach two: EPA would reallocate all the additional 2025 SRE volume to the 2027 compliance year

EPA will take public comments on the proposal until December 4, 2026.

Additionally, the proposed revision to the 2026 standards may extend the existing 2026 compliance reporting deadline of March 31, 2027. If finalized, this proposal will ensure that all the benefits of the “Set 2” rule will be realized for American farmers.

Today’s announcement is part of the Trump Administration’s all of government approach to opening markets for American farmers. By supporting a strong RFS program, EPA is working to keep generational farmers thriving and rural communities economically rich—Congress’ intent for the program.

Background

Announced on March 27, 2026, by President Trump during the Great American Agriculture Celebration, the historic “Set 2” rule realigned the RFS program with Congress’ original intent of increasing the use of homegrown American biofuels, putting American farmers first. In the 20th year of the RFS program, the final rule sets the highest renewable fuel volumes in the history of the program. With EPA estimating the final rule would generate over $10 billion for rural economies and create over 100,000 new jobs in the agricultural and manufacturing sectors, the Trump EPA’s action created a larger, more stable, and more reliable domestic market for U.S. crops. READ MORE

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Excerpt from AgWeb: The US Environmental Protection Agency proposed on Tuesday to make larger refiners blend more biofuels into their products over the next two years, a move that will likely appeal to farm-state voters ahead of November’s congressional elections.

The proposal would help offset concerns about lost demand for ethanol producers and farmers after the EPA announced in August it would waive renewable fuel volume obligations for 29 small refineries that argued the requirements would cause economic hardship.

The EPA proposed reallocating 100% of those waived fuel volume obligations and is seeking public comment after putting forward two approaches. One would split the additional 2025 small refinery exemption volume evenly between the 2026 and 2027 compliance years, while the other would allocate all of it to 2027.

Comments are due by December 4, 2026, the EPA said in a statement.

Renewable credit prices for biodiesel and ethanol fell slightly on the news, according to a refinery trader at the OPIS biofuels conference in Chicago.

The EPA in August decided to grant 1.76 billion RINs worth of small refinery exemptions for the 2025 compliance year, including full exemptions for 18 refineries and partial waivers for 11 others. At the time, the agency said it would seek to reallocate the exempted volumes to other refiners in future years to preserve overall biofuel blending requirements.

The exemptions, the largest ever issued under the Renewable Fuel Standard, drew sharp criticism from biofuel producers and farm groups, which argued they would reduce demand for ethanol and biodiesel and undermine markets for agricultural feedstocks.

Refiners said compliance costs and elevated RIN prices justified relief for facilities facing economic hardship.

“While we believe most of the exemptions were unjustified, EPA’s reallocation plan, if finalized as proposed, will help offset the demand loss for ethanol producers and farmers,” said Geoff Cooper, CEO of the Renewable Fuels Association, which represents ethanol producers.

The EPA also said reallocating the waived obligations could require extending the 2026 compliance year deadline of March 31, 2027. READ MORE

Excerpt from DTN Progressive Farmer: While meant to boost markets, the proposed rule didn't lead to any immediate reactions in the corn and soybean markets on Tuesday. Corn futures were essentially flat at midday while soybean futures were down 3 to 3.5 cents.

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Growth Energy and the Renewable Fuels Association (RFA), which represent the biofuels industry, both praised EPA for the proposal.

"With this proposal, EPA would deliver on the full potential of historic RVOs and fulfill its promise to make American farmers and biofuel producers whole," said Growth Energy CEO Emily Skor. "Reallocating lost gallons would strengthen the rural economy and provide relief to farmers looking for reliable new markets that won't be destroyed by costly exemptions.

Geoff Cooper, president and CEO of RFA, said his members believe the small refinery exemptions were unjustified, but the reallocation plan – if finalized – would help offset the demand loss for ethanol producers and farmers.

Cooper added that refiners are "enjoying record profit margins" while gasoline supplies are tightening and consumers are paying higher fuel prices. He credited the Trump administration for recognizing "this is no time to undermine domestic biofuels" with small refinery exemptions. Still, Cooper also said RFA continues to call for reforms to small refinery exemptions.

"These exemptions were always meant to be a temporary measure to give truly small, independent refiners a little more time to come into compliance with the RFS program," Cooper said. "Unfortunately, many so-called small refiners have viewed SREs as an entitlement program and have exploited this loophole for two decades, putting American consumers, farmers, and biofuel producers on the losing end."

The American Petroleum Institute (API) criticized EPA's announcement, arguing that the reallocation would make it harder for refiners to plan and invest in fuel supplies.

"U.S. refiners are running all out to meet demand and keep fuel flowing to American consumers," said Kristin Whitman, senior vice president of federal relations for API. "Reallocating small refinery exemptions, particularly at historically high renewable volume obligation levels, would add new uncertainty to an already strained fuels market, making it harder for refiners to plan and invest in the reliable fuel supplies consumers depend on. We are continuing to review EPA's proposed rule and remain committed to working with the administration and Congress on durable solutions that strengthen market stability and help keep fuel affordable."

Dave Walton, an Iowa farmer and president of the American Soybean Association (ASA), said the proposal would help maintain the historic renewable fuel volumes in the 2026-2027 Set 2 rule and protect domestic biofuel demand. Walton urged EPA to finalize the rule and reallocate the biofuel volumes as quickly as possible.

"Soybean farmers are navigating a tough farm economy, and the administration's strong domestic biofuel policies will continue to drive much-needed market demand in the U.S.," Walton said. "We are encouraged by today's proposal and urge EPA to get it across the finish line quickly."

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Zeldin maintained his visit was official and not a campaign event. EPA's news release included comments from Iowa's congressional delegation, including two House members in competitive re-election races and a House member running for U.S. Senate. READ MORE

Excerpt from KFGO: Kurt Kovarik, Clean Fuels’ Vice President of Federal Affairs, stated, “Clean Fuels appreciates Administrator Lee Zeldin’s effort to keep the Renewable Fuel Standard volumes on track and to release this proposal earlier than originally promised. As a result of this year’s historic RFS proposal, the U.S. biodiesel, renewable diesel, and SAF industry has invested billions of dollars in rural America, created new job opportunities, and massively increased domestic production of fuel to secure America’s energy dominance.

“The clean fuels industry is delivering on the goals for the RFS and providing a critical supply of lower-cost diesel fuels right now. That contribution is important to control diesel prices and associated consumer costs. We urge EPA to finalize the proposal to add supplemental volumes to both 2026 and 2027 to ensure that the market signal from the robust RFS volumes is clear and immediate.”

American Coalition for Ethanol CEO Brian Jennings issued the following statement:

“We appreciate EPA following through on its commitment to address the additional RFS volumes waived through 2025 SREs and proposing to reallocate the full difference between projected and actual exempted volumes. Every gallon of renewable fuel displaced by an SRE represents lost demand for American ethanol, lost value for farmers and a missed opportunity to lower fuel costs for consumers.

“The integrity of the RFS depends on ensuring the volumes established under the program translate into real-world renewable fuel demand. Farmers and ethanol producers need certainty that RFS requirements will not be eroded after the fact by exemptions.

“While this proposed reallocation is an important step, the debate over SREs has held up adoption of year-round E15. Congress must act to provide greater certainty and expand opportunities for ethanol by passing nationwide E15 legislation before the end of the year.

“We will continue working with EPA and participating in the rulemaking process to ensure the 2025 SRE volumes are fully and appropriately reallocated. At the same time, we will continue urging EPA to set strong RFS volumes in its upcoming Set 3 rule that support growing demand for E15 and account for any negative impact from SRE gallons not being fully reallocated.” READ MORE