EPA tries to thread needle with ‘ambitious’ RFS targets 

Source: Amanda Peterka, E&E reporter • Posted: Monday, June 1, 2015

EPA’s proposal sets renewable fuel mandates for 2014-2016, biodiesel mandates through 2017

The proposal calls for 15.93 billion gallons of total renewable fuels.

• Conventional ethanol: 13.25 billion gallons

• Advanced biofuels: 2.68 billion gallons

• Biodiesel: 1.63 billion gallons

• Cellulosic biofuel: 33 million gallons


The proposal calls for 16.3 billion gallons of total renewable fuels.

• Conventional ethanol: 13.4 billion gallons

• Advanced biofuels: 2.9 billion gallons

• Biodiesel: 1.7 billion gallons

• Cellulosic biofuel: 106 million gallons


The proposal calls for 17.4 billion gallons of total renewable fuels.

• Conventional ethanol: 14 billion gallons

• Advanced biofuels: 3.4 billion gallons

• Biodiesel: 1.8 billion gallons

• Cellulosic biofuel: 206 million gallons


The proposal calls for 1.9 billion gallons of biodiesel.

Note: All volumes are ethanol-equivalent, except for biodiesel, which is actual.

U.S. EPA proposed renewable fuel targets today that would boost biofuel use over an earlier scrapped proposal for 2014 but still lag targets that Congress anticipated when it wrote the federal biofuels program into law in 2007.

The Obama administration called its proposed targets “ambitious” but in line with market realities.

“The proposed volumes reflect various factors in the market that convince us both that renewable fuels are being produced and used in increasing volumes and that there are limits to amounts of volumes that can be supplied,” EPA acting air chief Janet McCabe told reporters on a conference call.

EPA’s proposal would set refiners’ blending targets for conventional ethanol and advanced biofuels for 2014, 2015 and 2016.

The proposal would set the 2014 targets at actual production levels. By 2016, refiners would be required to blend 17.4 billion gallons of renewable fuels into petroleum gasoline and diesel or they would have to buy fuel credits known as renewable identification numbers, or RINs (Greenwire, May 29).

The proposal would also set the 2017 target for biodiesel — made from soybean oil, animal fats and used cooking grease (see sidebar for full breakdown of proposed targets).

The proposal calls for 13.4 billion gallons of corn-based ethanol in 2015 and 14 billion gallons in 2016 — both lower than the 15 billion-gallon level that Congress set for it beginning in 2015.

McCabe today said the lower level for corn ethanol reflected the issues surrounding the “blend wall,” the term used to describe technical constraints for getting more ethanol into the marketplace.

The proposal also reflects slower-than-expected commercialization of non-food advanced biofuels, she said.

“Even as we recognize the successes of the program so far, we also must recognize real-world limitation to the further growth in renewable fuels in the near future,” McCabe said.

The agency is proposing to use its authority to lower the biofuel targets, including slashing volumes if there’s an “inadequate domestic supply” of biofuels. EPA used that authority in its prior unsuccessful proposal to lower the 2014 biofuel targets.

On the call today and in a fact sheet released this morning, EPA maintained that its interpretation of authorities follows the intent of Congress.

“While EPA is proposing to use the tools provided by Congress to waive the annual volumes below the statutory levels,” the agency fact sheet says, “we are proposing standards that are directionally consistent with Congress’ clear goal of increasing renewable fuel production and use over time.”

Jeremy Martin, a senior scientist in the clean vehicles program at the Union of Concerned Scientists, called the proposal a “pragmatic balance between ambition and reality” that would support non-food cellulosic biofuels.

“We are not where Congress hoped we would be in 2007, but we are making steady progress,” he said, “and with clear and timely administration of the policy can support steady growth of the advanced and especially cellulosic biofuels needed to realize the ambitious and important goals of the RFS.”

The proposal comes as the Department of Agriculture announced this morning that it would provide up to $100 million toward the installation of infrastructure to support higher blends of ethanol. Most gasoline sold in the country today contains 10 percent of ethanol; USDA’s Biofuels Infrastructure Partnership program would support blends of 15 and 85 percent.

USDA said it would administer competitive grants that match funding for state-led efforts to market higher ethanol blends.

“With this partnership, USDA is helping to ensure the infrastructure is in place for consumers to access more renewable fuels, expand marketing opportunities for farmers, and grow America’s rural economies,” Agriculture Secretary Tom Vilsack said.

Biofuel producers cheered the USDA announcement but expressed disappointment in EPA’s proposal for not reflecting the congressional levels. Ethanol trade groups said that the proposal capitulated to refiners that have to meet the requirements but don’t want to blend more of the corn-based fuel in gasoline.

“It is unfortunate,” Growth Energy CEO Tom Buis said, “that EPA chose to side with the obligated parties who have deliberately refused to live up to their obligation to provide consumers with a choice of fossil fuels or lower-cost, higher-performing, homegrown renewable energy at the pump.”

He added that the ethanol trade group would file “exhaustive comments” on the proposal “that will highlight the changes that are necessary to meet the goals of the RFS.”

Advanced biofuel producers called the proposal a step in the right direction but pushed for higher mandates for non-food fuels.

The Biotechnology Industry Organization slammed EPA for its delay in issuing the 2014 targets — which were due by Nov. 30, 2013 — and estimated that the agency has already been responsible for a $13.7 billion shortfall in investment for advanced producers.

“EPA has proven they still don’t understand the advanced biofuel industry’s need for policy stability,” said Brent Erickson, executive vice president of BIO’s industrial and environmental section. “The RFS was designed by Congress to tear down the so-called blend wall by providing a market floor for biofuels that would enable us to attract capital for construction of new biorefineries and commercialization of advanced technologies.

“Instead,” he added, “EPA is helping the oil industry build the blend wall to keep advanced biofuels out of the market.”