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EPA Announcement Brings A Cloud of Uncertainty with a Silver Lining

December 18th 2014

The U.S. Environmental Protection Agency (EPA) has announced it is delaying finalization of the 2014 Renewable Fuel Standard (RFS) Renewable Volume Obligations (RVO) until 2015. Deciding not to decide is not a decision. Unfortunately, the announcement today perpetuates the uncertainty that has plagued the continued evolution of biofuels production and marketing for a year. Nevertheless, the Administration has taken a major step by walking away from a proposed rule that was wrong on the law, wrong on the market impacts, wrong for innovation, and wrong for consumers. Moreover, it is clear that one of the reasons we find ourselves in this position is that the oil industry has steadfastly refused to make the investments in infrastructure or allow their marketers to offer higher ethanol blends like E85 or E15. In the absence of their dogged efforts to undermine the RFS, this would be far simpler for EPA. The monopoly-protecting talking points of the oil industry notwithstanding, the RFS has been enormously successful. It has compelled competition in motor fuel markets, lowered consumer gasoline costs, and reduced the carbon footprint of transportation fuels. We look forward to working with the Administration to assure this critically important program is implemented consistent with congressional intent, to the benefit of consumers and with the goal of advancing the evolution of biofuels production and marketing. Refiners will continue to resist the competition from biofuels. The RFS must be allowed to be the market forcing mechanism it was designed to be. In the end, the verdict on today’s announcement can only be made after a decision on a path forward for biofuels is identified.

Bob Dinneen is president and CEO of the Renewable Fuels Association.


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