U.S. EPA Commits To Increasing Biofuel Use, Targets Not Yet Finalized

The U.S. Environmental Protection Agency is committed to increasing the use of biofuels, an agency official said on Tuesday, but the industry is still anxiously awaiting the Biden administration to finalize specific blending goals.

The Biden administration is open to using every tool to fight climate change in the transportation sector, which includes biofuels, said EPA's Sarah Dunham, director of the Office of Transportation and Air Quality, at the National Ethanol Conference in New Orleans.

Both oil refiners and corn-based ethanol producers are paying close attention to the agency's planned sweeping decisions on the Renewable Fuel Standard, the nation's biofuel blending law, which is due to enter a new phase at the end of the year.

The Renewable Fuels Association, a leading biofuels trade group, has heard from the EPA that the agency is aiming to propose a rulemaking on statutes that mandate U.S. renewable fuel blending past 2022 in late spring or early summer, said Geoff Cooper, RFA's president, in a press hearing at the conference.

Cooper expects proposals for the 2023, 2024 and 2025 years to potentially be wrapped together, he said.

Under the RFS, oil refiners must blend billions of gallons of biofuels into the nation's fuel mix, or buy credits from those that do. Oil refiners historically have been able to receive waivers to the obligations, known as Small Refinery Exemptions, if they can prove the rules cause them financial harm.

The Trump administration about quadrupled the number of exemptions it gave out, stoking anger from biofuel groups that claim the waivers hurt ethanol demand. The oil industry disputes that and says the waivers help keep small refiners afloat.

Last year under Biden, the EPA proposed denying all pending SREs. It will take final action on that proposal after fully considering stakeholder comments submitted on the action, Dunham said.

Additionally this year, the Biden administration must make decisions to reset statutes that mandate U.S. renewable fuel blending, a process known as the Set. Congress only set yearly volume requirement targets of renewable fuel for the RFS program through 2022.

"We must look both backwards and forwards as we consider what volumes may be appropriate," she said.

Dunham also spoke on Tuesday about the ethanol industry's efforts to expand access to a higher-ethanol fuel blend known as E15. The industry has faced legal challenges in its efforts to increase sales of the blend.

The EPA is looking at different approaches to expanding E15, Dunham added.