The Environmental Protection Agency (EPA) released its proposed 2019 Renewable Volume Obligations (RVO) for RFS blending today, highlighting 19.88bn gallons of biofuels to be blended into the US fuel supply in 2019, a 3% rise from 2018. Information released by the EPA shows the proposed 19.88bn gal RVO for 2019 includes 381mn gal of cellulosic biofuel, 4.88bn gal of advanced biofuel and 2.1bn gal of biomass-based diesel. The 2019 RVO for biomass-based diesel was set last year. The proposed 2019 RVOs would allow for up to 15bn gal of conventional biofuel to meet the annual blending requirement, most of which is corn ethanol. Under the EPA’s proposed plan, the RVO for cellulosic biofuel will increase 93mn gals from the 288mn gal in 2018 to 381mn gal in 2019. The agency also proposed to increase the RVO for advanced biofuel from 4.29bn gal in 2018 to 4.88bn gallons in 2019, an increase of 590mn gal. The overall RVO for total biofuels would increase from 19.29 in 2018 to 19.88 in 2019 an increase of approximately 590mn gal.
While percentages of cellulosic, biomass, advanced and renewable fuel blending will increase under the EPA’s proposed plan, notably missing from today’s measure was the EPA failing to address the demand destruction caused the by the agency’s recent misuse of its hardship waiver authority. In response, RIN values on both the biodiesel and ethanol side of the complex dropped throughout the day, culminating in a 5% and 21% fall from late last-week levels. (Please refer to PRIMA’s Weekly US Biodiesel Report for more insights into RIN market fundamentals and pricing movements.)