The Environmental Protection Agency (EPA) on Thursday proposed revised, retroactive required volume obligations (RVOs) under the Renewable Fuel Standard (RFS) for 2020 and 2021 and lowered RVOs for CY2022. The agency also proposed to deny all pending exemptions to the RFS blending requirements.

EPA is proposing to retroactively revise 2020 RVOs to 510 million gallons for cellulosic biofuel, 2.43 billion gallons for biomass-based diesel, 4.63 billion gallons for total advanced biofuels, and 17.13 billion gallons for total renewable fuels. This implies that the conventional corn ethanol mandate will be set at 12.5 billion gallons, or 2.5 billion gallons lower than the RFS requires in the statute and the level that has been required in previous years.

EPA is also proposing to retroactively revise 2021 RVOs to 620 million gallons for cellulosic biofuel, 2.43 billion gallons for biomass-based diesel, 5.2 billion gallons for total advanced biofuels, and 18.52 billion gallons for total renewable fuels. This implies that the conventional corn ethanol mandate will be set at 13.32 billion gallons, or 1.68 billion gallons lower than the RFS requires in the statute and the level that has been required in previous years.

Finally, EPA is proposing new RVOs for 2022 at 770 million gallons for cellulosic biofuel, 2.76 billion gallons for biomass-based diesel, 5.77 billion gallons for total advanced biofuels, and 20.77 billion gallons for total renewable fuels. This implies that the conventional corn ethanol mandate will be set back at 15 billion gallons, or the limit that the RFS requires in the statute and the level that has been required in previous years.

Conventional corn ethanol blending obligations are implied by subtracting total advanced biofuels from the total renewable fuel blending obligation.

Due to EPA’s past decisions to grant Small Refinery Exemptions (SREs), the 15 billion gallon conventional corn ethanol mandate has not been met in recent years. SREs exempt some refineries from their blending obligations, thus lowering total corn ethanol output.

EPA also proposed to deny all pending SREs and indicated it would not consider issuing future SREs. At the time of the announcement, there were 60 SREs running through compliance years 2016 to 2021.

“The proposed decision results from EPA’s review of the pending SRE petitions and supporting information, its legal, technical, and policy analysis of the [Clean Air Act] provisions relating to small refineries, and its application of the holdings of the Court of Appeals for the Tenth Circuit in Renewable Fuels Association et al. v. EPA (RFA),” EPA said in its announcement.

These actions are not final Agency actions, but are public proposals coupled with request for comment to inform EPA’s final action.

EPA’s proposal on the RVOs can be found here. The proposal on the SREs can be found here.

 

 

 

 

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