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EPA finalises Renewable Fuel Standard for 2013

Hydrocarbon Engineering,

Last week the Environmental Protection Agency (EPA) issued its final rule for the 2013 Renewable Fuel Standard. The rule sets a 6 million gal target for cellulosic biofuels use in 2013, less than half the level in the proposed rule issued in February 2013, and far below the 1 billion gal target specified by the Energy Independence and Security Act of 2007 (EISA 2007).

The EPA can legally lower the required volumes of advanced biofuels and total renewable fuels by up to the amount that it reduces the required volume of cellulosic biofuels.

EPA did not reduce the advanced biofuels and total renewable fuels targets for 2013. This leaves the required volume for total renewable fuels in 2013 at 16.55 billion gal, as specified in EISA 2007.

However, the final rule indicates that the EPA anticipates the need to adjust 2014 RFS program targets, for which EISA 2007 specifies a total renewable fuels target of 18.15 billion gal.

A May 2013 letter from EIA cited in EPA’s final RFS rule, and recent testimony by EIA Administrator Adam Sieminski, outlines that production of cellulosic biofuels has grown at a much slower pace than envisioned in EISA 2007.

Aside from delays in the ramp up of cellulosic biofuels production, RFS implementation has recently been challenged by the decline in recent and projected gasoline consumption since enactment of EISA 2007. This change reflects higher vehicle fuel economy standards, slower economic growth, higher gasoline prices, and possible changes in consumer behaviour.

The level of gasoline consumption limits the amount of ethanol that may be used in the gasoline pool at any fixed blending level, such as the 10% ethanol blend (E10). The anticipated need for adjustments in the 2014 RFS advanced biofuels and total renewable fuels targets reflects a combination of demand and supply issues in the biofuels marketplace, including:

  • The E10 blend wall in the context of stagnant or declining demand for petroleum based gasoline.
  • The limited ability of the motor gasoline market in the US to consume ethanol in higher blends such as E15 and E85, which are constrained as a result of infrastructure and market related factors.
  • The difficulty of producing significant volumes of non-ethanol advanced biofuels such as biodiesel, renewable diesel, and biogas.

Adapted from a press release by Emma McAleavey

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