EPA finalizes 2013 RFS volumes, extends compliance deadline

The U.S. EPA has finalized the 2013 volume requirements for the renewable fuel standard (RFS). The final 2013 overall volumes and standards require 16.55 billion gallons of renewable fuels to be blended into the U.S. fuel supply. At this blend level, biofuels will make up 9.74 percent of U.S. transportation fuel.

The standard for biomass-based diesel is set at 1.28 billion gallons, accounting for 1.13 percent of the fuel market. The requirement for advanced biofuels is 2.75 billion gallons, or 1.62 percent of transportation fuel. The cellulosic standard is 6 million gallons, which equates to 0.004 percent of transportation fuel. The remaining 12.514 billion gallons of the mandate can be met by any renewable biofuel.

According to the EPA, it received many stakeholder comments concerning the E10 blend wall, which is projected to occur in 2014. In the rule setting the final 2013 requirements, the EPA said it is announcing that it will propose to use flexibilities in the RFS statute to reduce both the advanced biofuel and total renewable volumes in the forthcoming 2014 RFS volume requirement proposal.

A statement issued by the EPA also notes that it is providing greater lead time and flexibility in complying with the 2013 volumes requirements by extending the deadline to comply with the 2013 by four months. The new deadline is set for June 30, 2014.

Several biofuel trade organizations have weighed in on the EPA’s announcement. The Renewable Fuels Association said that EPA’s decision to reduce the cellulosic requirements from the statutory level of 1 billion gallons to 6 million gallons demonstrates the flexibility of the RFS program. “First and foremost, by decreasing the cellulosic requirement by 99.4 percent to a very realistic, achievable number, the EPA has totally obliterated Big Oil’s myth that the RFS is inflexible and unworkable,” said Bob Dinneen, president and CEO of the RFA. “As in years past, the finalized annual requirements are a testament to the inherent flexibility that is the backbone of the RFS.”

Brooke Coleman, executive director of the Advanced Ethanol Council said it is clear the EPA has done its homework in setting the standard and that the commercial cellulosic biofuel facilities that the EPA projected would begin operations in 213 are indeed operating. “We are at a critical juncture in the implementation of the RFS, with advanced biofuels just beginning to come on line,” Coleman continued. “Careful administration of the program is absolutely critical right now to get the right balance between the legislative intent of the program and the market response to the program. This is another clear example of the agency utilizing the flexibility provisions originally legislated by Congress to ensure that the RFS is attainable each and every year. Amidst all the smoke and mirrors coming from those who do not want to see competition in the motor fuel marketplace, people need to remember that the renewable fuels industry produced enough conventional and advanced renewable fuel to meet the original legislated standard through 2012, and expect to again in 2013. This is a tremendous accomplishment in a challenging fiscal environment. Our industry continues to transform the liquid fuel marketplace by making motor fuel cheaper, creating new jobs for Americans and reducing our dependence on foreign oil. U.S. EPA’s steady hand is a big part of the program’s success to date.”

The American Coalition for Ethanol issued a statement noting that the EPA thoughtfully used the flexibility given to it by Congress to set the final cellulosic target at 6 million gallons. “We think that total is realistic to reach this year,” said Brian Jennings, executive vice president of ACE. “To ensure that the RFS drives sufficient demand for E15 and higher blends of ethanol, and serves as a catalyst for innovation in advanced and cellulosic biofuels, ACE will continue our constructive dialogue with EPA as it considers its flexibility to address the volumes for 2014 and beyond.”

Growth Energy said it is pleased that the EPA has set the final 2013 volumes and has continued to show its commitment to the RFS program. “We look forward to closely reviewing the final rule and we strongly support increasing levels of renewable fuel into our nation’s fuel supply,” said Tom Buis, CEO of Growth Energy. “The RFS continues to be a resounding success, helping create jobs in America that cannot be outsourced, revitalizing rural economies across the country in addition to reducing our dependence on foreign oil and improving our environment, all while providing consumers with a choice and savings at the pump.”

Fuels America said the targets set by the EPA reflect the reality that the biofuels industry is growing and becoming a vital part of our transportation fuel mix. “By setting the 2013 targets as such, the EPA is fully utilizing the flexibilities incorporated within the RFS. It also provides evidence that the RFS works: it adjusts to market conditions,” said the coalition. “In just five years, the RFS has driven substantial investment in our domestic fuel industry, created jobs for Americans, and most importantly – built a market for oil alternatives in our transportation fuel sector. The policy allowed domestically produced, renewable fuel to displace 462 million barrels of crude oil in 2012, and is poised to further reduce our dependence on fossil fuels. The RFS is working.”

The Biotechnology Industry Organization has also welcomed EPA’s finalization of its 2013 RFS standards. “This is a pivotal year for cellulosic and advanced biofuels. Following years of research and development and millions of dollars in investment, the first companies are right now commissioning biorefineries and producing commercial volumes of cellulosic fuel for American drivers. Additional companies have new facilities under construction, with expected start up over the next few years,” said Brent Erickson, vice president of BIO’s Industrial & Environmental Section. “This rapid innovation in cleaner, renewable fuels is creating thousands of new jobs today. The visible progress of the industry is proof that the renewable fuel standard works.”