Canadian Biomass Magazine

EPA to propose biofuel reforms soon

July 26, 2012
By Argus Media

July 26, 2012, Washington, DC — The US Environmental Protection Agency (EPA) is expected to release in early August a tentative plan for implementing new protections in the market for federal biofuel credits, known as renewable identification numbers (RINs).

Lawmakers and oil refiners have been prodding the agency to act quickly in the wake of fraudulent RINs being sold into the market and the EPA holding some buyers of those credits responsible even when they were purchased in good faith.

The reforms are aimed at improving buyer confidence following the revelation that three firms issued 140mn in fraudulent biodiesel RINs without producing the underlying biofuel.

Refiners, some of which paid penalties for taking the invalid credits, have held a series of meetings with the EPA this year on ways to amend Renewable Fuels Standard (RFS) regulations that require submission of the credits to comply with the federal biofuel blending mandate.

Oil industry representatives met with the EPA last week and were told a tentative plan would be drafted as soon as this week. But the agency is now expected to release something around the week of 6 August, with the agency meeting with stakeholders between now and then.

Refiners and the biofuel industry are looking for a solution that will make oil firms less skittish about buying from small biodiesel producers. The oil industry wish list calls on the agency to issue a rule that limits liability for purchasing certain invalid credits and sets standards for a voluntary RIN verification program.

US lawmakers are pressing the EPA to finish the reforms by the end of this year. In a congressional hearing earlier this month the EPA would not commit to that deadline, but indicated it may settle on the basic features of a plan by January.

“EPA is working with industry stakeholders to discuss opportunities for improving the renewable fuels program in a timely manner, including the concept of a third-party RIN verification process,” the agency said.

The biodiesel industry is less adamant about a regulatory solution and has developed a verification service with energy data firm Genscape to address refiners' concerns.


“The Wild West of buying and selling RINs from market participants you don't know has ended,” National Biodiesel Board chief executive Joe Jobe said in testimony to the House of Representatives energy committee on 11 July.

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