Study of RINs and Retail Gas Prices Finds No Relationship

Cindy Zimmerman

A new study by Informa Agribusiness Consulting finds that prices of the Renewable Identification Number (RINs) credits used for RFS compliance have not caused changes in retail gasoline prices

The analysis, commissioned by the Renewable Fuels Association (RFA), looked at trends in the prices for conventional biofuel RINs and retail gasoline from 2013 to the summer of 2017.

“Based on statistical analysis, it can be concluded that changes in RIN prices did not ‘cause’ the changes that occurred in retail gasoline prices in 2013, and this has continued to be the case through the summer of 2017,” according to Informa Agribusiness Consulting. Instead, the price of retail gasoline has been primarily driven by movements in crude oil prices and by changes in the spread between domestic and international crude oil prices, as well as seasonal demand, the analysis found.

RFA President and CEO Bob Dinneen says the analysis shows that the EPA’s proposal to lower total Renewable Fuel Standard (RFS) would lower the price of RINs, but not prices at the pump. “If finalized, however, these proposals will have a decidedly negative impact on the U.S. ethanol industry by artificially cannibalizing demand,” said Dinneen. “If the intent is to lower the price of RINs, EPA should consider expanding ethanol demand by empowering consumers to utilize higher level ethanol blends. After all, ethanol is less expensive than gasoline today and RINs attached to each gallon of ethanol purchased from a producer are free.”

Click here to read the Informa Agribusiness Consulting analysis.

Ethanol, Ethanol News, RFA, RFS, RINS