Policy Corner: RVOs Explained

On December 7, 2021, the Environmental Protection Agency (EPA) released the long-awaited proposed 2020, 2021 and 2022 Renewable Volume Obligations (RVO), which set annual targets for how much biofuel must be blended into America’s fuel supply under the Renewable Fuel Standard (RFS). Overall, it was a mixed bag for the biofuels industry.

Under the Trump Administration, EPA’s 2020 rule called for 20 billion total gallons of biofuels, including 15 billion conventional gallons and five billion advanced gallons. In early 2021, the EPA extended the compliance deadline for 2020 obligations for refiners to meet these goals.

For the first time, the EPA retroactively reduced the volumes of a past RVO. This decision impacted the 2020 volumes and set an irresponsible precedent. Not the ideal response from an administration that promised to strengthen the Renewable Fuel Standard (RFS). The numbers from 2021 are closer to but still lower than actual blending rather than pushing more renewable fuels into the market.

However, the good news is that the 2022 numbers reinstate 15-billion-gallon volumes, and the industry will receive an additional 500 million gallons of court-ordered volumes over the next two years. Furthermore, the EPA intends to finally dispose of small refinery exemptions and will deny all pending applications. The POET team is working diligently alongside our industry allies to urge the EPA to reinstate robust blending targets before the rule is finalized and, as President Biden has said, “Get the RFS back on track.”

We are also continuously reminding the Biden Administration that biofuels play an integral role in achieving our national and global climate goals. Biofuels are the most affordable, abundant and readily available way to decarbonize the transportation sector while advancing the bioeconomy and supporting America’s rural economies.




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