EPA delivers final rule containing 2020 RVOs, SRE plan to OMB

By Erin Voegele | December 10, 2019

The U.S. EPA delivered a final rule regarding the Renewable Fuel Standard to the White House Office of Management and Budget on Dec. 6. The final rule includes the 2020 RFS renewable volume obligation (RVO), the 2021 RVO for biomass-based diesel, and the agency’s plan to address future small refinery exemptions (SREs). OMB review marks a final step before the rule is released publicly.

The EPA released its proposed rule to set 2020 RVOs and the 2021 RVO for biomass-based diesel in July. The proposed rule aims to require 20.04 billion gallons of renewable fuels to be blended with the U.S. fuel supply next year, up from 19.92 billion gallons in 2019. The proposed RVO includes 5.04 billion gallons of advanced biofuels, 2.43 billion gallons of biomass-based diesel, and 540 million gallons of cellulosic fuel. The 2020 RVO for biomass-based diesel was finalized in a separate rulemaking last year. The rulemaking also proposed to set the 2021 RVO for biomass-based diesel at 2.43 billion gallons, level with the 2020 RVO.

When compared to the 2019 RVOs, the EPA’s proposed rule would increase the RVO for cellulosic biofuel by 120 million gallons. Due the nested nature of the RFS RVOs, the implied RVOs for advanced biofuel and renewable fuel would remain at the 2019 level.

A public comment period on the proposed rule closed Aug. 30. More than 5,600 comments were filed. The Coalition for Renewable Natural Gas and RNG stakeholders urged the EPA to increase the cellulosic RVO in the final rule. The National Biodiesel Board also asked the agency to increase the 2020 RVO for advanced biofuel and the 2021 RVO for biomass-based diesel. Representatives of the ethanol industry, including the Renewable Fuels Association, Growth Energy and the American Coalition for Ethanol, largely focused on the impact of SREs in their rulemaking comments.

More than a month after the original public comment period on the proposed rule closed, the EPA issued a supplemental notice of proposed rulemaking regarding its plan to reallocate RFS volumes lost to future SREs. That proposal, released Oct. 15, was slammed by supporters of the biofuels industry. The White House originally briefed industry representatives on a deal that would use a three-year rolling average of actual SRE waived volumes to predict future waived volumes. The EPA’s rulemaking, however, proposes to use a three-year rolling average of U.S. Department of Energy SRE recommendations rather than actual waived volumes to project future SREs. Unlike data on actual waived SRE volumes, DOE recommendations are not publically available and have largely been disregarded by the EPA in recent years during its process to evaluate and approve or deny SRE applications. 

A public comment period on the supplemental notice of proposed rulemaking closed Nov. 29. More than 11,700 comments were filed on the rulemaking. Comments filed by representatives of the biofuels industry called on the EPA to honor congressional intent and President Trump’s commitment to the RFS.

One week after the comment period on the supplemental notice of proposed rulemaking closed, the EPA delivered a final rule containing the 2020 RVOs, 2021 RVO for biomass-based diesel, and the agency’s plan to reallocate SRE volumes to the OMB. A notice posted to the OMB’s website also indicates the final rule “addresses the remand of the 2016 standard-setting rulemaking, and finalizes several regulatory changes to the [RFS] program.” 

The EPA is expected to release the final rule before the end of the year.