EPA sets 2016 cellulosic waiver credit prices at $1.33

By Erin Voegele | November 16, 2015

The U.S. EPA has published a notice to its website announcing its cellulosic waiver credit (CWC) price calculation for next year. The agency has set the CWC price for 2016 at $1.33.

The the price of CWC is determined using a formula specified in the Clean Air Act. According to the EPA’s notice, for any calendar year for which the projected volume of cellulosic biofuel production is less than the applicable volume set forth in the CCA, the agency must reduce the required volume of cellulosic biofuel for that year to the projected volume. The agency must also provide obligated parties the opportunity to purchase CWC waiver credits. The price of the credits is 25 cents or $3 minus the wholesale price of gasoline, with both figures adjusted for inflation.

In March 2015, the EPA introduced rulemaking to change the way CWC prices are set. That rule was finalized earlier this year. While the EPA, in previous years, established the CWC price by rulemaking, the agency indicated that process resulted in delays in CWC prices for 2014 and 2015. The recent rulemaking allows EPA to announce the CWC prices in a timelier manner via its website.

A full copy of the EPA’s notice of CWC price calculation for 2016 can be downloaded from the agency’s website.