| The Environmental Protection Agency (EPA) on June 13, 2025, issued its (RVOs) for 2026 and 2027 under the Renewable Fuel Standard (RFS). EPA has proposed to require 24.02 billion Renewable Identification Numbers (RINs) of renewable fuel in 2026, and 24.46 billion RINs in 2027. EPA is also proposing to partially waive the 2025 mandate for cellulosic biofuel. We continue to digest and analyze this complex and important proposal. It is clear that EPA is realigning the RFS to better align with the Trump Administration鈥檚 broader 鈥淎merican First鈥� philosophy, which prioritizes American feedstock and American production. This will impact different markets differently. For example, coastal markets that rely on imports will feel much differently than Midwestern markets. EPA also did not provide much clarity about听how they intend to handle Small Refinery Exemptions (SREs), which could impact overall volume requirements. Unlike the bullish ethanol and biomass-based diesel signals, the cellulosic mandate appears quite bearish, meaning the renewable natural gas (RNG) community is likely to be upset in the wake of this proposal. EPA conducted a thorough and diligent process leading up to this proposal, and we are grateful for their bona fide attempt to thread the complex political needle that is the RFS. It continues to be clear that this proposal is not on its own capable of saving the domestic biodiesel industry from its near-term challenges. This only further underscores the urgency of Congressional action to extend the Biodiesel Tax Credit. |
麻豆色播 will provide a more in-depth analysis in the coming days and will file comments on the proposal ahead of the deadline on August 8, 2025. EPA will also hold a virtual public hearing on July 8, 2025, for the Proposed Rule.
*EPA originally established a cellulosic biofuel volume requirement of 1.09 billion gallons for 2024 in the previous final RVO rulemaking. EPA subsequently reduced this volume requirement to 1.01 billion RINs in a separate action. EPA originally established a cellulosic biofuel volume requirement of 1.38 billion gallons for 2025 in the previous final RVO rulemaking. EPA is proposing to reduce that volume requirement to 1.19 billion RINs as a part of this proposed rulemaking.
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**These numbers are not proposed standards and are presented by EPA for illustrative purposes only. The projected BBD volumes account for the projected impacts of the proposed RIN reduction for imported renewable fuel and renewable fuel produced from foreign feedstocks and the proposed revised equivalence value for renewable diesel. EPA projects that the average number of RINs generated for BBD will be 1.27 and 1.28 RINs per gallon in 2026 and 2027, respectively.
As there remains uncertainty in the volume of gasoline and diesel that will be exempt in 2026 and 2027, EPA developed an upper- and lower-bound estimate of exempted volumes for the proposed percentage standard volume. EPA projects that there are approximately 34 qualifying and operational small refineries producing up to approximately 18 billion gallons of gasoline and diesel each year, or about 10 percent of the total reported volume of obligated gasoline and diesel. Therefore, the potential range of exempt volumes from SREs that could be included in the calculation for 2026 and 2027 ranges from zero gallons (if EPA denied all SRE petitions) to 18 billion gallons (if EPA granted all SRE petitions).
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