RFS package ‘modestly positive’ for biofuels, analysts say

Source: By OPIS • Posted: Thursday, December 9, 2021

The Biden administration’s long-awaited Renewable Volume Obligation (RVO) targets and broader Renewable Fuel Standard (RFS) package released on Tuesday seems to have found a reasonable middle ground between refiners and biofuels producers, according to reaction from a range of analysts who cover the industry. Tuesday’s release included downwardly revised RVOs for 2020 and 2021, RVOs for 2022, a proposal to deny all pending small-refinery exemption (SRE) petitions and a 500-million-gal remand to be applied in 2022 and 2023 from EPA, among other action items, as well as relief funds and infrastructure grants totaling $800 million from USDA. ¬†The proposals, modifications and funds seem to have found somewhat of a happy medium, analysts say. In an analysis piece released Tuesday, Tudor, Pickering, Holt & Co. (TPH) said the package was positive for refiners, modestly positive for renewable natural gas (RNG) and negative for renewable diesel. ¬†Similarly, Goldman Sachs late Tuesday said the release was “modestly positive for biofuels.”