Biodiesel Industry Poised to Help Fill Advanced Biofuel Requirement

By Anne Steckel | March 12, 2013

The National Biodiesel Board recently welcomed the proposed rule from the U.S. EPA establishing the 2013 advanced biofuels requirements under the renewable fuel standard (RFS) at 2.75 billion RINs. The U.S. biodiesel industry is poised and ready to help meet these requirements, and to supply more domestic fuel choices to consumers.

Biodiesel has been a bright spot in the RFS, exceeding production requirements for two consecutive years. Last year, the industry produced nearly 1.1 billion gallons of fuel, with plants in nearly every state in the country supporting more than 64,000 jobs.

For this year, the EPA’s RFS proposal calls for an overall advanced biofuel requirement of 2.75 billion RINs. Within that total, the biomass-based diesel requirement, which has already been finalized, is 1.28 billion gallons (1.92 billion RINs). Refiners have the option of using biodiesel or other EPA-designated advanced biofuels to help fill the remaining overall advanced biofuel pool, and many experts are predicting that biodiesel will play an increasing role in doing so this year due to the return of the biodiesel tax incentive and favorable blending economics.

It is important to note that 2.75 billion RINs actually requires substantially less than 2.75 billion gallons of advanced biofuels. For example, biodiesel is an advanced biofuel with a RIN value of 1.5, so each gallon of biodiesel produced is multiplied by a RIN value of 1.5. Therefore, if only biodiesel is used to fill the entire advance pool, only 1.83 billion gallons of biodiesel would be required. Today, there are more than 200 biodiesel plants registered with the EPA, representing a combined production capacity in excess of 3 billion gallons, more than enough capacity to meet the requirements of the advanced biofuel program in 2013.

For the record, the overall renewable fuel volume statutorily required for this year is 16.55 billion RINs. Under the program, the 16.55 billion can be met by using 2.75 billion RINs of advanced biofuels and 13.8 billion RINs of conventional ethanol.

The biodiesel industry is already the leading producer of advanced biofuels in the country, accounting for more than 82 percent of required advanced production last year, and more than 90 percent since the program began in 2010. The biodiesel industry is adding new feedstocks and building capacity every year, and the RFS will only help continue that growth.

Because of the importance of the RFS to the biodiesel industry, NBB continues to work with the EPA on a regular basis to make sure that the 200-plus member companies that have invested time, effort and capital resources into this industry are represented. NBB is working to submit formal comments to EPA on the proposed advanced biofuel rule now. EPA will then address all of the comments submitted and provide a final rule, expected to come sometime early this summer.

The RFS is already working as intended. Growth in technology, innovation and capacity in the U.S. biofuels sector has led to increased green jobs, growth in renewable fuel use, reduced emissions and a more diverse transportation energy supply. Biodiesel and other advanced biofuels are making significant contributions to our energy supply and we must stay the course to continue this success.

Anne Steckel, Vice President of Federal Affairs, National Biodiesel Board

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