Changes in the RFS are coming, but not from Congress. EPA will likely reduce the annual percentage standards for biofuels in the RFS for 2014, says Brian Jennings, executive vice president, American Coalition for Ethanol.
While the repeal of the Renewable Fuel Standard (RFS) is currently off the table, opponents have been trying to “reform” it, said Brian Jennings, executive vice president, American Coalition for Ethanol during the ACE Conference last week in Des Moines, IA. “But, the change won’t come from Congress. It will come from the EPA,” he said.
The EPA already has the flexibility and authority to change the annual percentage standards for the RFS for cellulosic biofuel, biomass-based diesel, advanced biofuel and total renewable fuel. If any of these fuels fails to reach the minimum level in two consecutive years, by law EPA must adjust the levels, but not before 2016. “That is why getting cellulosic ethanol production off the ground is so important," Jennings said. He also predicted that EPA will reduce the total and advanced biofuels in the 2014 proposed rule.
Some 2.5 billion renewable identification numbers (RINs) were carried over from 2012 into 2013, Jennings said. This, coupled with the industry’s ability to produce a sufficient amount of ethanol and biodiesel, enabled refiner compliance with the volumes required by the RFS for 2013. However, there will not be that kind of RIN cushion in 2014, Jennings said. As a result, the use of biofuels, such as E85 and E15, should continue to rise next year as long as neither Congress nor EPA make severe cuts to the RFS levels, he added.
Note: RINs are credits that can be traded, enabling obligated parties (blenders) to comply with the RFS. Each RIN corresponds to a gallon of renewable fuel.
Brian Jennings at the American Coalition for Ethanol (ACE) Conference last week.