EPA Well-Justified to Maintain 15 Billion Conventional Biofuel RVO in 2018 RFS, But Cellulosic Ethanol Target Needs Increase, RFA Tells EPA

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August 1, 2017 at 8:20 am

WASHINGTON – In testimony delivered at a public hearing today in Washington, D.C., Renewable Fuels Association (RFA) President and CEO Bob Dinneen thanked the Environmental Protection Agency for proposing to maintain the 15 billion gallon requirement for conventional renewable fuels in its 2018 Renewable Fuel Standard (RFS) rule, but urged the agency to increase its proposed cellulosic ethanol requirement to reflect growing bolt-on technologies at existing ethanol plants.

EPA’s recently released 2018 RFS proposal calls on refiners to blend 15 billion gallons of conventional renewable fuels like corn ethanol in 2018, adhering to the statutory requirement and unchanged from the final 2017 renewable volume obligation (RVO) rule.

We believe EPA is well-justified in that decision, given the overwhelming evidence that more than sufficient D6 RINs [conventional ethanol renewable identification numbers] will be available for compliance this year and next,” Dinneen testified.

However, EPA is proposing to lower the cellulosic ethanol requirement to 238 million gallons in its 2018 rule.  “We understand the agency’s dilemma in establishing an appropriate RVO for cellulosic ethanol, but we truly believe the agency has erred on the side of pessimism with regard to the potential for significant growth in cellulosic ethanol commercialization,” Dinneen told EPA. “We know that many plants are in the process of adding bolt-on fiber conversion technology to their existing facilities that could dramatically increase cellulosic ethanol production next year, and we intend to provide you with updated projections during the comment period.”

In EPA’s proposal, the agency noted that it will initiate a separate re-set rule, since a reduction in both the cellulosic ethanol and advanced biofuel requirements have triggered this authority. “We respect the agency’s obligation to reset the advanced and cellulosic biofuel targets to provide greater long term stability and certainty in these markets,” Dinneen testified. “But we caution the agency that reset does not mean repeal, and the agency must be faithful to the spirit and intent of the RFS, which is to maximize the nation’s use of these fuels, to drive marketplace innovation and investment in these new technologies, and to make the U.S. more energy diverse and lower carbon emissions from transportation fuels.  Congress entrusted EPA with the ability to reset the RFS, not to gut the RFS,” he told EPA.”

Dinneen also told EPA about continued concerns with RIN market manipulation and suggested EPA continue to allow imported biofuels to help comply with the RFS. “The RFS is not the platform to address trade concerns,” he testified.

“The RFS has been an incredible success story – lowering consumer gasoline costs, creating jobs, reducing carbon, stimulating investment in new technologies, providing energy and economic security, and assuring a more sustainable energy future,” Dinneen said. A strong RFS will continue to help drive investment and ensure the future growth of ethanol, the cleanest, lowest cost and highest source of octane on the planet, he added.

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