EPA must provide certainty for low-carbon fuels In 2023 and beyond

Source: By Michael McAdams, The Hill • Posted: Monday, May 30, 2022

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When the Senate Committee on Environment and Public Works held a hearing on the nomination of Joseph Goffman to be the EPA’s Assistant Administrator for the Office of Air and Radiation (OAR), lawmakers met one of the most experienced people in Washington on issues ranging from transportation regulation to agricultural emissions sources. I can say this because in my decades of experience in renewable energy, I have rarely seen anyone with the dedication and drive to stakeholder engagement, negotiation, and problem-solving.

If confirmed, Goffman will need to use all those skills — and all the regulatory authorities and tools enabled by the Renewable Fuels Standard (RFS) — to advance the U.S. toward a lower-carbon, energy independent future. In the next few months, EPA will need to establish new targets for the minimum volume of renewable fuels required in the liquid transportation market for 2023 and beyond. If Goffman is confirmed, he will have the opportunity to move this rulemaking quickly and set strong, multi-year targets to send a critical signal to the fuels markets: the future of the RFS program will be about delivering greenhouse gas (GHG) emissions reductions.

Since it was established by Congress in 2005, the RFS has been the main policy tool for expanding the production and use of low-carbon fuels in the United States and has helped the advanced biofuels industry triple the gallons blended into the U.S. transportation fuel supply since its implementation.

Under the RFS, the EPA proposes annual Renewable Volume Obligations (RVO), which are specific target volumes of renewable fuels that refiners or importers of petroleum-based gasoline or diesel fuel must use. However, in recent years, these targets have been set retroactively, which has ultimately distorted the biofuels markets and created uncertainty around the future of the RFS program.

This year is no exception, as the EPA is currently preparing to finalize the 2020, 2021, and 2022 RVO package half-way through this year. Completing this soon, and setting the highest volume obligations possible, is critical. But, to fully capture the environmental, societal, and economic benefits of the RFS as Congress intended, the Agency must quickly pivot and focus on proposing the next RVO rulemaking for 2023 and beyond, no later than early summer 2022. This process is colloquially known as the “set”, as after 2023 the RFS statutory volume standards expire and the law broadens EPA’s authority to set volume standards, making the role at the helm of OAR that much more important.

The RFS program operates at the confluence between fuel markets and the environment, where crises are gripping the world and impacting Americans’ health and wallets on a daily basis. The EPA’s leadership has never been more important in strengthening the U.S.’s advanced biofuels sector, which would ultimately increase the U.S.’s energy independence and reduce our transportation sector’s GHG emissions footprint.

To the Biden administration’s credit, it has taken steps to reduce greenhouse gas emissions, most notably by committing to electrify 50% of our nation’s passenger automobiles by 2030. Still, this plan leaves 50 percent of the cars on the road reliant on traditional fossil fuels — not to mention all of the freight trucks, aircraft, ships and boats, and other large transport vehicles that will remain reliant on high carbon-fuels.

Low-carbon advanced biofuels can power these trucks, planes, and shipping tankers, and deliver significant carbon reductions with almost no change to the country’s current fuel distribution infrastructure. Plus, the technology and consumer demand for advanced biofuels is growing — the members of the Advanced Biofuels Association alone expect to account for five billion gallons of renewable diesel production by the end of 2024.

For the long-term, Goffman must prioritize a forward-thinking “set” rulemaking that is tailored to maximize the opportunity of the RFS to meaningfully tackle climate change. For advanced biofuels, this also includes separate regulatory actions on approving new technologies and feedstocks under the program’s pathway process, and statutory clarity for feedstock definitions to allow emerging markets such as sustainable aviation fuel (SAF) more feedstock choices.

EPA is also currently undertaking an effort to reevaluate its methodology and models for calculating lifecycle GHG analysis under the RFS program. To meaningfully deliver on the U.S.’s climate objectives, EPA should make this process as broad and inclusive as possible to deliver a durable, defensible methodology that will help drive the U.S. closer to President Biden’s net-zero by 2050 target.

It is incumbent that the EPA use its authority to support programs that can push the nation closer to achieving critical climate and energy independence targets. And the best way to do that will be to start by confirming Goffman.

Michael McAdams is president of the Advanced Biofuels Association.

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