EPA lowers 2013 cellulosic mandate

Source: Amanda Peterka, E&E reporter • Posted: Wednesday, April 23, 2014

U.S. EPA issued a new 2013 cellulosic biofuel standard today, capping a reconsideration process that began after the oil industry argued the original target was too high.EPA said it would require refiners to show that they either blended or purchased credits for 810,185 ethanol-equivalent gallons of cellulosic biofuel. The new number is far below the 6 million gallons that the agency finalized for cellulosic biofuel last year.

The agency took the action through a direct final rule, saying in a statement the new target is meant to “better align the standard with newly available production data from 2013.”

The American Petroleum Institute and American Fuel & Petrochemical Manufacturers had petitioned EPA to reconsider the 6-million-gallon target last year, saying that there would not be enough fuel produced in the market to meet the target.

The agency agreed, citing new information about KiOR Inc., a cellulosic biofuel company that struggled last year to maintain consistent operations and this year announced it would go idle. EPA had counted on KiOR to provide the majority of the gallons in its 2013 cellulosic standard (Greenwire, Jan. 23).

The new target is based on actual production data for cellulosic biofuel in 2013, EPA said. None of the agency’s other renewable fuel targets will be affected by today’s action.

EPA won’t hold a formal comment period on the new mandate but will accept feedback. It will only withdraw the cellulosic standard if it receives negative feedback; the agency today also published a proposed rule in case there is objection.

“EPA believes that timely finalization of a new 2013 cellulosic biofuel standard will reduce regulatory uncertainty as well as administrative burden for obligated parties,” the agency said.

The oil industry groups have also challenged EPA’s 2013 cellulosic target in court, but the U.S. Court of Appeals for the District of Columbia Circuit put the challenge on hold pending action by EPA.