EPA Proposes To Slash Ethanol Blending Mandates For 2020 And 2021

The U.S. Environmental Protection Agency issued proposed RFS annual blending mandates this week that significantly lower renewable fuel (ethanol) volumes for 2021. The EPA is proposing to set the 2021 renewable fuel blending mandate at 13.3 billion gallons.

Also, in an unprecedented move, the agency is proposing to retroactively reduce the 2020 renewable fuel (ethanol) blending mandate previously set at 15 billion gallons to 12.5 billion gallons.

According to the EPA, the retroactive reduction is due to lower demand for transportation fuels during the COVID-19 pandemic.

The EPA already set the 2021 biomass-based diesel (biodiesel) blending mandate at 2.43 billion gallons in a previous rulemaking.

The EPA delayed decisions on 2021 blending obligations by more than a year and recently missed the November 30th deadline to finalize 2022 blending mandates.

EMA has for many years called for lower annual corn ethanol blending volumes that would allow marketers to determine for themselves whether to sell E15 rather than be required to do so through a de facto mandate.

EMA sent multiple letters to the EPA and the National Economic Council this year requesting urgent action to reduce the corn ethanol mandate to address the current E15 crisis.

Click Here and Here to read EMA’s letters.

EMA fully believes in renewable fuels and their importance in the liquid fuels market and plans to ask the Biden Administration to ensure that future federal grant funds will be available for small business energy marketers to upgrade their underground storage tank system equipment to safely and legally sell E10 plus blends.

“Today’s EPA announcement is important to marketers because if the RFS continued to go unchecked, the majority of retail sites across the country would be unable to legally sell E15 due to non-compatible UST system equipment. To point out the facts of infrastructure compatibility issues is not being anti-ethanol. To the contrary, we must ensure that ethanol continues to be sold in a safe and legal manner for it to have a promising future,” said EMA President Rob Underwood.

Proposed RFS Volume Requirements (In Billion Gallons)

                                                            2020    2021    2022

Cellulosic Biofuel                               .051     .062     .077

Biomass-based Diesel (biodiesel)       2.43     2.43     2.76

Advanced Biofuel                               4.63     5.2       5.77

Renewable Fuel (Ethanol)                  12.5     13.3     15.0

Supplemental Standard                       n/a      n/a       0.25

The agency’s proposal also includes a call to add a 250 million gallon “supplemental obligation” to the volumes proposed for 2022 and another 250 million gallons in 2023, in response to a 2017 court ruling that invalidated an EPA waiver of 500 million gallons.

In addition, the proposal would deny the 65 petitions pending refinery exemption requests before the agency and opens comment on its outlook on future waivers.

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