EPA Publishes Proposed Renewables Enhancement and Growth Support Rule

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On November 11, 2016, the EPA published a proposed rule designed to update its Renewable Fuel Standards Program and support the growth of renewable fuel use. With the stated goal of removing barriers to production and distribution of renewable fuels, the proposed rule has three main components:

(1) Updated Regulatory Structure to Address Biofuel Processing at Multiple Facilities – In some circumstances, biofuel producers can decrease the costs of production by processing feedstock at one facility and converting that material—called a biointermediary—into a biofuel at another facility. The previous guidelines did not adequately address the requirements for biofuels processed at more than one facility, so the new regulations clarify the requirements for registration, recordkeeping, and reporting for biofuels produced in multiple facilities. These new regulations will be aligned with those already in place for single-facility production.

(2) Updated Regulations Regarding High Ethanol Fuel Blends – The EPA is revising its regulations to provide expanded availability of high ethanol fuel blends for flex fuel vehicles. Flex fuel vehicles can operate on a gasoline-ethanol mixture with an ethanol percentage as high as 83 percent. In an effort to make these high-ethanol fuels more readily available, the updated regulation clarifies the standards that E16-83 fuel blends—now known as “ethanol flex fuel” —must meet. The EPA’s intention is that imposition of these clarified standards will allow producers to make ethanol-gasoline blends from sources other than certified gasoline blendstock, thereby increasing the supply of these fuels.

(3) Approval of New Feedstock for Cellulosic Biofuels – The EPA aims to increase the use of cellulosic biofuels, the fuels with the lowest carbon emissions. To that end, the EPA has approved the use of short-rotation poplar and willow trees for feedstock in biofuels, the use of cellulosic diesel made from the co-production of cellulosic feedstock and petroleum, and the use of renewable diesel and biodiesel produced from separated food waste.

The proposed rule also covers various miscellaneous items such as registration requirements for generation of renewable electricity that is used as transportation fuel and requirements for facilities that could potentially use carbon capture and storage with respect to emissions from renewable fuels in the future. The public comment period on the proposed rule ends January 17, 2017, though it is currently unclear how these regulations will be impacted by changes to current EPA leadership as result of the recent election.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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