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EPA Official Offers Hint on Future of RFS

Care of Pennsylvania Petroleum Association

On Thursday, a high ranking U.S. Environmental Protection Agency official indicated the agency plans to base its 2014 Renewable Fuel Standard blending volumes on actual biofuels production and fuel consumption.

Additionally, 2015 RFS blending volumes will be based on actual production to date and projected gasoline demand through the rest of the year.

Chris Grundler, director of the EPA’s Office of Transportation and Air Quality, acknowledged the lack of compatible retail infrastructure have impacted EPA’s ability to increase the corn-based ethanol mandate in recent years. Grundler said, “We can’t ignore those facts.”

Meanwhile, EPA Administrator Gina McCarthy will testify before the House Energy and Commerce Subcommittees on Energy and Power and Environment and the Economy next Wednesday.

The hearing will focus on EPA’s FY 2016 budget, however, it is expected that lawmakers will have several questions concerning when EPA plans to finalize 2014, 2015 and 2016 RFS blending volumes.

It is unfortunate that EPA has yet to meet their statutory obligation to publish proposed volumes in a timely fashion which leaves refiners guessing on how much blended renewable fuels are needed each year.

EPA must propose and finalize volumes each year by the preceding November.

Also, a bipartisan group of 32 Senators sent a letter to the EPA regarding 2014 and future biodiesel volume requirements last week. They requested that EPA set the 2014 biodiesel blending volumes at actual production volumes and move to set the 2015 and 2016 RVOs as soon as possible.

PMAA has urged EPA to set ethanol RVO’s to parallel the E10 market because E15 and E85 face too many infrastructure and marketplace barriers. If EPA does not do so, some refiners may be forced to cut back production or export gasoline, a very negative outcome for consumers.

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