How EPA is Destroying Demand for Ethanol and Corn

Cindy Zimmerman

Recent actions by EPA have effectively reduced the Renewable Fuel Standard conventional renewable volume obligation (RVO) for 2016 by more than 1 billion gallons, and the agency appears poised to take similar actions to effectively reduce the 2017 and 2018 conventional RVOs by comparable amounts, according to Renewable Fuels Association Executive Vice President Geoff Cooper.

In a blog post last week, Cooper explains how these cuts have resulted in significantly lower prices for Renewable Identification Numbers, reduced corn and ethanol demand, avoided legal obligations for highly profitable businesses, and windfall profits for certain small oil refiners.

“In total, nearly 2.4 billion gallons of ethanol demand and 860 million bushels of corn demand have potentially been lost over the past two compliance years due to EPA’s recent actions,” Cooper says. He details how EPA’s actions to exempt refineries from the 2016 RFS requirements, not enforcing the full 2016 Renewable Volume Obligations (RVO) of 15 billion gallons and excusing Philadelphia Energy Solutions from its 2016 and 2017 RFS obligations results in the 2016 RFS requirement being lowered from 15 billion gallons to just 13.82 billion, an 8% reduction.

Click to read the analysis.

Ethanol, Ethanol News, RFA, RFS