Written on: December 23, 2016 by ICM
Grand Forks, ND – (December 7, 2016) – On Nov. 23, the U.S. EPA released its final rule to set 2017 renewable volume obligations (RVOs) under the renewable fuel standard (RFS), along with 2018 RVOs for biomass-based diesel. The RVO for conventional fuel has been increased to meet the 15 billion gallon congressional target for conventional fuels. Overall renewable fuel volumes grow by 1.2 billion gallons from 2016 to 2017, a 6 percent increase. The rule finalizes RVOs proposed in May.
The final nested volume for total renewable fuel has been set at 19.28 billion gallons, up from a proposed volume of 18.8 billion gallons. On a percentage basis, the final standard for total renewable fuel has been set at 10.7 percent of the total transportation fuel pool, up from a proposed 10.44 percent. In 2016, the renewable fuel RVO was set at 18.11 billion gallons, or 10.10 percent.
The final 2017 RVO for advanced biofuels is set at 4.28 billion gallons, up from a proposed level of 4 billion gallons. On a percentage basis, the advanced biofuel RVO is set at 2.38 percent, up from a proposed 2.22 percent. In 2016, the advanced biofuel RVO was set at 3.61 billion gallons, or 2.01 percent.
The EPA has finalized the 2017 RVO for cellulosic biofuel at 311 million gallons, down slightly from a proposed 312 million gallons. On a percentage basis, the cellulosic RVO has been maintained at the proposed 0.173 percent. The 2016 RVO for cellulosic biofuel was set at 230 million gallons, or 0.128 percent.
The 2018 RVO for biomass-based diesel has been maintained at the proposed 2.1 billion gallons. The percentage standard has also been maintained at 1.67 percent. The 2017 RVO for biomass-based diesel was set at 2 billion gallons, or 1.59 percent.
According to the EPA, the RVO for total renewable fuel is 1.2 billion gallons, or 6 percent, higher than 2016. The advanced biofuel RVO grew by approximately 700 million gallons, while the cellulosic RVO has increased by 35 percent and the advanced biofuel RVO is up 19 percent. In addition, the 2018 RVO for biomass-based diesel is set 100 million gallons higher than the 2017 standard.
The statutory 2017 RVOs specified in the Clean Air Act call for 24 billion gallons of total renewable fuel, with the nested values for advanced biofuel, biomass-based diesel and cellulosic biofuel set at 9 billion gallons, at least 1 billion gallons and 5.5 billion gallon, respectively.
Renewable fuel volumes continue to increase across the board compared to 2016 levels, said Janet McCabe, EPA acting assistant administrator for the Office of Air and Radiation. These final standards will boost production, providing for ambitious yet achievable growth of biofuels in the transportation sector. By implementing the program enacted by Congress, we are expanding the nations renewable fuels sector while reducing our reliance on imported oil.
Within the final rule, the EPA addresses its use of the general waiver authority to reduce RVO volume below statutory levels. The agency explains that when setting the 2014-2016 RVO, it determined there was an inadequate domestic supply of total renewable fuel, and used the general waiver authority to reduce the total renewable fuel volumes further than the reductions obtained using the cellulosic water authority. The use of the general waiver authority in this way has been strongly criticized by those in the biofuel industry.
The EPA notes that it again proposed to use the general waiver authority in a similar fashion when setting the 2017 RVO for total renewable fuel, but has since changed its mind. Based on further evaluation of the availability of renewable fuel in the market, in the interim between the [notice of proposed rulemaking (NPRM)] and this final rule, and review of public comment, EPA has determined that it is not necessary to use the general waiver authority, said the agency in the final rule. That is, we have determined that use of the cellulosic waiver authority alone will be sufficient to yield a volume requirement that is consistent with available supply, … Read More
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