What do we know about the 2014 US biofuels mandate under the Renewable Fuel Standard?

In Washington, it’s getting to be like waiting for a Pope to be elected, trying to figure out the EPA’s timing andintentions on the 2014 RVO (renewable volume obligation).

If industry figures are sounding diplomatic and hopeful notes in public, that could be generally ascribed to their “don’t upset the applecart” policy. Privately, they’re changing their diapers. 

Habem Mandatem? Here’s what we know from the black and white smoke filtering out of the EPA chimneys.

1. Good news. Educated fingers are pointing at a total ethanol pool of 13.6 gallons, with EPA signalling that increased gasoline sales give them some room to bump up the overall number without risking a run-up in RIN prices over E10 saturation concerns.

2. Bad news. The EPA appears not to be retreating from its new framework that ethanol mandates will be tied not to congressional targets but to the available pool of E10 demand, plus any expected E15 or E85 market distribution that the agency can identify. That’s a victory for the oil lobby, which has been pressing for such a framework when it is not outright pressing for repeal.

3. Biomass-based diesel news. We haven’t heard anything north of 2.75 billion gallons from the sources we visited with recently, and we haven’t heard a lot of that. The expectation on the biodiesel gallonage is zeroing in on 1.5 billion gallons (or 2.25 billion ethanol-equivalent gallons toward RVO totals, since biodiesel has higher energy density. That would leave no more than 500 million gallons for everyone else — advanced ethanol, sugarcane ethanol, and renewable diesel among them. That’s tight.

4. Timing. OMB has the EPA’s recommendation now. EPA itself in its regulatory tracking portal is tipping a decision appearing in the Federal Register in October — and that means the news would likely start to flow by the end of the month.