Better Late than Never

Industry Reactions: Generally Positive But Notably Different

Industry stakeholder reactions to the Renewable Volume Obligation (RVO) announcement were generally positive, though some suggested the new requirements didn’t go quite far enough to account for the many millions of gallons of renewable diesel production scheduled to come online in the years ahead.

Clean Fuels Alliance America, formerly the National Biodiesel Board, issued the following statement:

“Clean Fuels and its members appreciate EPA Administrator Regan’s recognition that homegrown, clean fuels offer a better solution to high fuel prices stemming from high oil prices and supply shortages,” said Kurt Kovarik, vice president of federal affairs for Clean Fuels. “We support EPA’s efforts to get the Renewable Fuel Standard back on track and to finalize 2022 volumes as a jumping off point for future growth. We stand ready to work with the agency to move forward and set volumes for 2023 and beyond. And we encourage the agency to quickly finalize new feedstocks pathways, such as that for canola oil.”

The Advanced Biofuels Association, which represents many longtime biodiesel and renewable diesel producers as well as conventional oil refiners that have been investing in alternative fuel production, had this to say:

“With this RVO ruling, the Biden administration has missed an important opportunity to prioritize advanced low carbon fuels that will help America achieve its climate ambitions and support American energy independence. We were, however, pleased to see the regulations permitting the use of biointermediates finalized in this rule, enabling our members using these processes to participate in the RFS program and increasing the volumetric potential of the advanced biofuels industry now and in the years to come.”

Both associations applauded the SRE denials.

Biointermediates: What They Are and Why They Matter

The EPA’s RFS announcement concluded with the following paragraph.

“To promote efficiency and opportunity in producing biofuels, this action also establishes a regulatory framework that allows biointermediates to be included in the RFS program, while ensuring environmental and programmatic safeguards are in place.”

Biointermediates are a mouthful, but also hugely important to the future of renewable fuels. Here’s a quick rundown.

When the RFS program was first created, it was assumed that renewable fuels would be processed and produced in one facility. Many companies have since suggested it would be more efficient to pre-process feedstock at a separate location, resulting in an intermediary or biointermediate that would be refined into a biofuel product at a second location. However, under previous RFS rules, this kind of production would not have generated RIN credits, so there was no financial incentive attached.

Now, under the new ruling, the RFS allows for “the pre-processing of feedstocks listed in approved pathways at facilities other than the renewable fuel production facility, but only if the pre-processing results only in a form change such as chopping, crushing, grinding, pelletizing, filtering, compacting/compression, centrifuging, degumming, dewatering/drying, melting, or the addition of water to produce a slurry.” Additionally, several specific biointermediates — biocrude, free fatty acid feedstock, and undenatured ethanol — have been explicitly approved.

This could allow for a significant increase in advanced and cellulosic biofuel production, which is critical if these fuels are to become widely used across several industries, including not only heating and trucking but also air, marine, and rail transportation. This, after all, is the Department of Energy’s stated intention (see “On the Road to Net-Zero Transportation” on page 36 of this issue).