In making the announcement of its final renewable fuel volumes for 2013, the Environmental Protection Agency (EPA) also announced its intention to propose to use "its flexibilities in the RFS statute to reduce both the advanced biofuel and total renewable volumes" in its upcoming 2014 RFS volume requirement.
EPA stated that the agency had received comments from stakeholders about the ethanol blend wall, which is expected to occur in 2014. Gasoline volumes have been declining since 2007 when Congress passed the Energy Independence and Security Act (EISA), which drastically increased required volumes of ethanol and other renewables in the nation's fuel supply.
With declining gasoline consumption, even if refiners and importers blended 10 percent ethanol in every gallon of gasoline, it is expected that by next year, refiners will be unable to meet the volume requirements under EISA. Higher blends, such as E15, could help refiners meet the higher renewable volumes, but there is little consumer interest in blends exceeding 10 percent ethanol.
The 2013 RFS requires 16.55 billion gallons of renewable fuels to be blended into the U.S. fuel supply (a 9.74 percent blend) includes the following:
• Biomass-based diesel (1.28 billion gallons; 1.13 percent)
• Advanced biofuels (2.75 billion gallons; 1.62 percent)
• Cellulosic biofuels (6.00 million gallons; 0.004 percent)
EPA, which released the 2013 volumes several months late, said it would extend compliance deadlines for the 2013 standards by four months, to June 30, 2014.
The Energy Independence and Security Act (EISA) established the RFS program and the annual renewable fuel volume targets, which steadily increase to an overall level of 36 billion gallons in 2022. To achieve these volumes, EPA calculates a percentage-based standard for the following year. Based on the standard, each refiner and importer determines the minimum volume of renewable fuel that it must ensure is used in its transportation fuel.
More information on the standards and regulations can be found here.
More information on renewable fuels can be found here.
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