The Advanced Ethanol Council expressed disappointment today in the proposed 2014 required volume obligation (RVO) for the federal Renewable Fuel Standard (RFS).
“While only a proposed rule at this point, this is the first time that the Obama Administration has shown any sign of wavering when it comes to implementing the RFS,” said Brooke Coleman, Executive Director of the Advanced Ethanol Council (AEC). “EPA is in the right ballpark for cellulosic biofuels, and we are confident that the final number will be the right one for the industry in 2014. But bigger picture issues must be resolved in the final rule because advanced biofuel investors also pay attention to the big picture.”
The Council pointed to unnecessary reductions to the advanced biofuel pool, unfounded concern about imaginary blend walls, and not enough faith in the mechanics of the RFS program among certain Administration officials as the primary issues that need to be resolved during the comment period.
“What we’re seeing is the oil industry taking one last run at trying to convince administrators of the RFS to relieve the legal obligation on them to blend more biofuel based on clever arguments meant to disguise the fact that oil companies just don’t want to blend more biofuel. The RFS is designed to bust the oil monopoly. It’s not going to be easy,” added Coleman.
The Council added that the catalyst for too conservative a proposal is higher RIN prices in 2013.
“We hope that the Obama Administration will realize that reasonably higher RIN prices are a good thing instead of a bad thing. Higher RIN prices are a sign that the oil companies are predictably refusing to blend actual liquid gallons of fuel to comply with the RFS. But higher RIN prices are encouraging those unwilling to obstruct on RFS compliance to actually blend more renewable fuels. Investors are starting to see the RIN program drive more demand for renewable fuels with consumer savings at the pump. Now is not the time to depressurize the program,” Coleman said.
The Council added that the industry is more united than ever before, and will work together to fix the final rule.