EPA sets 2020 cellulosic waiver credit price at $1.80

By Erin Voegele | January 08, 2020

The U.S. EPA posted a notice to its website Jan. 8 announcing the Renewable Fuel Standard cellulosic waiver credit (CWC) price for 2020 is $1.80. The price is slightly higher than the 2019 CWC price, which was set at $1.77 in December 2018. 

RFS regulations require the EPA to set CWC prices annually. For any calendar year for which the projected volume of cellulosic biofuel production is less than the applicable volume requirement set by statute, the EPA must reduce the required volume of cellulosic biofuel for that year to the projected volume and must provide obligated parties the opportunity to purchase cellulosic waiver credits. The price of CWC credits is determined using a formula specified in the Clean Air Act.

That formula states the CWC price is the greater of 25 cents or $3 minus the wholesale price of gasoline, where both the 25 cents and the $3 are adjusted for inflation. To determine the CWC price, EPA said it determines the average wholesale price of gasoline using the most recent 12 monthly values for U.S. total gasoline bulk sales as provided by the U.S. Energy Information Administration as of Sept. 30 of the year preceding the compliance year.

Additional information is available in a notice posted to the EPA website.