US orders refiners to boost biofuel quotas after gasoline prices surge

Bloomberg

The US is ordering refiners to boost the use of biofuels such as corn-based ethanol, as the Biden administration tries to strike a balance between competing political and economic pressures while gasoline prices soar.
The US Environmental Protection Agency (EPA) is requiring refiners to mix 20.63 billion gallons of renewable fuels into gasoline and diesel this year — a 9.5% increase over last year’s target. In a final rule posted online, the agency also said it was retroactively paring the 2020 biofuel-blending quota to 17.13 billion gallons and setting
the overall 2021 target at 18.84 billion gallons to reflect actual consumption.
The mandates come as President Joe Biden battles record-high gasoline prices, climbing food costs and
inflationary pressures that threaten the US economic recovery as well as Democrats’ grip on Congress after the November midterm elections. The EPA said the moves were meant to help put the nation’s Renewable Fuel Standard program into a growth mode and propel market demand for alternatives to petroleum-based gasoline and diesel.
“We are laser-focused on providing more options for consumers at the pump, and today we are taking steps
to increase the availability of homegrown biofuels,” EPA Administrator Michael S Regan said in a statement.
“Today’s actions will help to reduce our reliance on oil and put the RFS program back on track after years of challenges and mismanagement.” Refiners argued the 2022 target is so ambitious it would also boost industry compliance costs with some of the burden passed on to consumers.
Refining advocates and their allies in Congress had unsuccessfully appealed to the administration for a
significant reduction, arguing the 2022 target is
contingent on promised
renewable diesel production coming online and
will strain the available pool of tradable credits used to prove quotas have been fulfilled.