At an early morning panel discussion during the Clean Fuels Alliance America Conference 2025, held in San Diego, California on January 20-23 of this year, industry experts and stakeholders gathered to dissect the future of the Renewable Fuel Standard (RFS), exploring the regulatory landscape, ongoing legal challenges, and the evolving market dynamics that are shaping biofuel policies. While this discussion did have a stark 7:30am start time, the fine people at Hilton San Diego Bayfront did supply us with fresh muffins and juice. The two panelists slotted to speak bring years of hands on knowledge and legislative experience to the conversation and are listed below:
Kate Shenk – Clean Fuels Alliance – Director of Regulatory Affairs
Anthony Reed – FGS Global – Legislative and Policy Strategist
Here’s a recap of the key discussion points from the panel that stood out to us here at RINSTAR Renewable Fuel Registry:
- Delays in RFS Rulemaking and Legal Action
The expected finalization of the 2026 RFS rule, initially scheduled for November 30, 2024, has been delayed, which is “no shock to anyone who’s spent more than six months with the RFS” Reed quipped. As a result, Clean Fuels Alliance and Growth Energynotified the EPA of their intent to sue for missing the deadline. Ongoing negotiations between these industry groups, the EPA, and the Department of Justice (DOJ) continue to seek resolution on the issue, with the delay becoming a point of contention for industry stakeholders who are eager for clarity. - Historical Precedents for RFS Policy Shifts
Drawing from the history of RFS regulation, the panelists reflected on the approaches taken by previous administrations. Under EPA Administrator Scott Pruitt during the Trump Administration, despite significant delays in rulemaking, there was a clear commitment to finalizing rules within expected timelines. This approach, however, also saw market instability due to uncertainty around regulatory decisions, especially concerning SREs. Historically, small refinery exemptions cause delays in trading as market participants await the granting of waivers, adding another layer of unpredictability to the entire RIN market. - “Feedstock, feedstock, feedstock”
The availability of feedstock plays a crucial role in the EPA’s decisions regarding Renewable Volume Obligations (RVOs). The panel emphasized the EPA’s focus on year-over-year growth in feedstock availability over total production capacity. Stakeholders, including Clean Fuels Alliance, have provided data to show increased production capacity and crush capacity, hoping to influence policy decisions. The panel encouraged all industry players to continue supplying data to the EPA, ensuring well-informed decisions regarding future RVOs. - Political Landscape and Industry Alignment
The political landscape surrounding RFS policy remains complex. While neither Republicans nor Democrats are fully committed to or opposed to the program, their approaches differ. Historically, tensions between the biofuels industry and the oil sector were evident, especially under the Trump Administration. However, there is optimism that a second Trump term could be more favorable, given increased investment in renewable fuels and the growing business opportunities in the sector. The panel stressed that when the biofuels and oil industries align on policy, it allows for quicker, more efficient rulemaking by the EPA. - Expected Changes to RVOs and Market Impact
Industry stakeholders are advocating for a significant increase in RVOs to reflect the realities of current production in the USA. The Clean Fuels Alliance has petitioned the EPA to reconsider the RVOs for 2024 and 2025, suggesting a target of 5.6 billion gallons, up from the current 3.35 billion gallons. The panel raised concerns that the current RVO levels are too low, which could lead to market overproduction and potential disruptions. Historically, the EPA has shown a tendency to gradually increase RVOs, with occasional dips linked to global events like the pandemic. - The Impact of Small Refinery Exemptions (SREs) on Market Stability
A central point of discussion was the backlog of 138 pending SRE requests that the new administration will need to address. Under the Trump Administration, a peak of 1.7 billion gallons in SRE waivers was granted in a single year, leaving the market in a state of flux. Legal battles are ongoing, with some court rulings having overturned previous blanket denials under the Biden Administration. These rulings could pave the way for the Trump administration to reassess its approach to SREs, adding another layer of complexity to the market and regulatory environment. - Tax Policy’s Role in RFS ComplianceThe Biodiesel Tax Credit (BTC) was highlighted as an essential component of market stability. While the BTC has remains at $1 per gallon, the market continues to face challenges due to low RVO targets. Panelists stressed that while tax credits help, a broader solution is needed to ensure long-term biofuel market stability—namely, increasing RVOs rather than relying on tax credits as the primary mechanism for supporting biofuels.
- Legislative Pushes and Industry PrioritiesThree main legislative priorities were presented by the two panelists. The E15 legislative push, which aims to increase the availability of ethanol-blended fuels year round, remains a high priority for the ethanol sector. The Marine RINs bill, which seeks to allow renewable fuels used in marine applications to generate RINs under the RFS, was also highlighted as a key piece of pending legislation. While the Fuels Parity Act, which would allow corn ethanol to qualify as an advanced biofuel, was discussed, its chances of passing were considered slim due to ongoing political divisions.
Conclusion: Navigating a Complex Future for the RFS
The panel discussion made it clear that the future of the RFS program is intertwined with both regulatory decisions and market realities. From the ongoing debates surrounding Small Refinery Exemptions to the push for expanded RVOs, stakeholders in the renewable fuels industry are closely watching how the regulatory landscape evolves. With key legal actions, political dynamics, and the increasing importance of feedstock availability at play, the path forward for the RFS program remains as uncertain as it is pivotal for the future of renewable energy in the U.S. Continue checking back into our RINSTAR blog to gather more information about RFS updates and how they affect those in the renewable fuel industry.