RFS Final Rule Provides Stability and Modest Growth for Biodiesel

Nov 30, 2015

The U.S. Environmental Protection Agency (EPA) released the Final Rule setting the Renewable Fuel Standard (RFS) volume requirements, including the volume requirements for biomass-based diesel for 2014, 2015, 2016, and 2017 on Monday. The American Soybean Association (ASA) appreciates EPA, the U.S Department of Agriculture(USDA) and the Obama Administration for their contributions to this Final Rule that provides some stability and modest growth for the U.S. biodiesel industry.

The Final Rule sets the biomass-based diesel volumes at the following levels:

  • 2014 – 1.63 billion gallons
  • 2015 – 1.73 billion gallons
  • 2016 – 1.9 billion gallons
  • 2017 – 2.0 billion gallons

These volume levels represent a modest improvement over the Proposed Rule. The Proposed Rule called for 1.63 billion gallons in 2014, 1.7 in 2015, 1.8 in 2016 and 1.9 in 2017.

The volumes established by EPA will provide some certainty to biodiesel producers and feedstock providers and will continue to generate many benefits for consumers and the environment. As outlined in the comments submitted by the ASA in July, the benefits of biodiesel include a more diversified energy market; increased domestic energy production; reductions in greenhouse gas emissions; new jobs and economic development; expanded markets; and reduced soy meal feed costs.

While the volumes in the Final Rule do not fully capitalize on the capacity and growth potential of U.S. biodiesel, it does provide a step in the right direction.

“We are glad to see the volumes for biomass-based diesel increased above the Proposed Rule and previous proposals," ASA President Wade Cowan said. "Biodiesel provides significant economic and environmental benefits and we have the capacity to do more. The Administration wants to address climate change and reduce greenhouse gas emissions and biodiesel can contribute more to that effort.”

Biodiesel is a domestically produced, renewable fuel that is proven to achieve emissions reductions ranging from 57 to 86 percent and is the first and only Advanced Biofuel to reach commercial-scale production nationwide. Biodiesel has made up the vast majority of Advanced Biofuel production under the RFS to date.

"As an industry we have always advocated for RFS volumes that are modest and achievable and the biodiesel industry has met or exceeded the targets each and every year that the program has been in place," Cowan said.

Accounting for approximately half of the feedstock used, soybean oil remains the largest source of oil for biodiesel production.

The ASA wishes to specifically acknowledge the role of the USDA and the efforts of Secretary Vilsack and his team, which have consistently demonstrated their understanding and support for the benefits that the RFS provides for farmers and rural communities.

By law, EPA is supposed to finalize biomass-based diesel volumes 14 months in advance of the applicable year, making the agency significantly overdue in setting the volumes for 2014, 2015 and 2016.

“This Final Rule will get the RFS implementation back on track and hopefully enable the EPA to remain on schedule in future years," Cowan said.