Final Rule Sent to OMB; White House has 90 Days to Finish

Source: By Todd Neeley, DTN/Progressive Farmer • Posted: Sunday, October 23, 2016

OMAHA (DTN) – EPA has sent the final rule for the 2017 Renewable Fuel Standard blend levels to White House for its approval.

The White House Office of Management and Budget is expected to complete its review of the final rule within the next 90 days to set renewable volume obligations in the RFS. The OMB received the final rule from the U.S. Environmental Protection Agency on Wednesday.

The notice indicates EPA is on track to finalize volumes by its statutory Nov. 30 deadline. For years the agency has struggled to meet RFS deadlines.

“2017 RVO Rule apparently at OMB — looks like EPA will make its deadline,” Renewable Fuels Association President and Chief Executive Officer Bob Dinneen said on his Twitter feed Wednesday. “NO reason not to go to 15 bg. #RFSWorks #ethanol #followthestatute.”

OMB’s job is to review government rules to determine their potential economic consequences.

“With farmers harvesting the largest crop in history, EIA (Energy Information Administration) data demonstrating we can blend above 15 billion gallons and the price of oil on the rise again, there is simply no reason to lower the RVO as proposed,” Dinneen said in a statement to DTN.

“In the final 2017 rule, EPA should increase the conventional RVO to the statutory level of 15 billion gallons and give consumers more of a choice at the pump.”

The final rule could be released within the next 30 days, depending on how long the OMB analysis takes.

The proposed 2017 RFS volumes increase mandate requirements for blenders compared to the 2016 numbers across all biofuels. Ethanol supporters, however, pushed for EPA to set volumes as called for in the original 2007 law.

EPA proposed a 2017 total RFS volume of 18.8 billion gallons. That would include 4 billion gallons of advanced biofuels, composed of 312 million gallons of cellulosic biofuels, 2 billion gallons of biodiesel and 1.68 billion of other advanced biofuels. The rest of the RFS volume — 14.8 billion gallons — would be covered largely with corn-based ethanol.

Part of the problem of meeting the RFS requirements under the law is the inability of the cellulosic industry to take off and produce the necessary volumes. This is an issue EPA grapples with every year. Under the RFS law, refiners are mandated to blend in 5.5 billion gallons of cellulosic ethanol in 2017, but there are only a handful of viably commercial cellulosic plants operating in the country.

The law requires the total RFS for 2017 to be 24 billion gallons, which would include that 5.5 billion gallons of cellulosic ethanol. The volume of corn-based ethanol would be 15 billion gallons. Other advanced biofuels and biodiesel would account for 4.5 billion gallons.