EPA Proposes Supplemental RFS Rule

SECAUCUS, NJ (DTN) — The US Environmental Protection Agency issued Tuesday (9/16) a proposal for relocating biofuel volumes granted to the small refinery exception (SRE) program by 50% and 100% through 2027.

The EPA said the so-called supplemental notice of the proposed Renewable Fuel Standard (RFS)  “Set 2” covers volume requirements in 2026 and 2027 that extends exemptions given out on August 22 to small refineries, that typically produce less than 75,000 bpd.

Specifically, under consideration, it said, are small refinery exemptions for compliance years 2023-2025 that will be accounted for when establishing FRS in the “Set 2” final rule.

Ahead of the EPA notice, small refinery exemption decisions on August 22 this year allowed utilization of significant volumes of gasoline and diesel for the 2023 and 2024 compliance years. That has resulted in an increased number of Renewable Identification Numbers (RINs) available for obligated parties to use for compliance. One RIN equals one ethanol-equivalent gallon.

EPA said it expects additional exemptions to be granted for the 2025 compliance year. The ability for obligated parties to use these RINs to comply with the 2026 and 2027 renewable volume obligations is expected to impact demand for renewable fuel if not carefully considered, EPA said.