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The EPA Gets It Right: Expanding America’s Low-Carbon Fuel Landscape

[originally published in RealClear Energy]

As the U.S. mission to reduce carbon emissions becomes more urgent, so too should the belief that our effort must be driven by a practical, all-of-the-above strategy. For too long, America has followed a restrictive policy path focused on select technologies – at the expense of other, proven solutions – that has produced limited carbon reduction results. We need a new, more inclusive approach.

Thankfully, the U.S. Environmental Protection Agency (EPA) recently took an important step to invest in and expand the adoption of other fuel technologies, like advanced biofuels, when it issued its 2023-2025 Renewable Volume Obligations (RVOs). Advanced biofuels, which are required to deliver at least 50% reduced carbon emissions versus traditional fuels, represented most of the total renewable fuel growth in the EPA’s latest ruling. It’s a welcome acknowledgement the progress that these sustainable fuels have made in recent years and the growing role that they’ll play in our carbon reduction efforts moving forward.

At the same time, the ruling still underestimates our industry’s production strength. As we continue to work with the EPA and other stakeholders on future rulings, our industry remains committed to America’s decarbonization efforts and will continue to supply even greater quantities of sustainable fuels to power our transition to a lower carbon future.

Since it was established by Congress on a bipartisan basis in 2005, the Renewable Fuel Standard (RFS) has been America’s preeminent policy mechanism driving the production and use of low-carbon fuels, like advanced biofuels, in the U.S. The program has helped to grow the domestic production of low-carbon, sustainable fuels from 343 million gallons in 2010 to over 2.3 billion gallons today. And numerous studies investigating the industry’s feedstock supply and production growth suggest that this is just the tip of the iceberg.

In fact, the Energy Information Administration (EIA) noted the strength of America’s renewable fuels industry earlier this year when it found that U.S. renewable diesel production capacity could more than double by the end of 2025. And our industry is confident that renewable diesel production will rise to as much as 6.3 billion gallons by that year, if not more.

These sustainable fuels, made from renewable, non-food biomass, can play a critical role in our clean energy transition. They can power heavy transportation vehicles – like aviation, heavy-duty trucking, and marine shipping – that are essential to our economy and for which electrification technologies are impractical or unfeasible. And they can be rapidly deployed using our existing national fuel supply infrastructure at virtually no cost to taxpayers.

Over the past few decades, the advanced biofuels industry has been a reliable partner by delivering these cost-effective carbon reduction outcomes. Following last year’s Inflation Reduction Act, which included provisions to support the production of sustainable aviation fuel (SAF), America’s low-carbon fuel sector moved quickly to meet the challenge. Already, World Energy, a leading advanced biofuels producer, is halfway to producing more than 1 billion gallons of SAF by 2030.

It is a good sign that the EPA considered these proven environmental outcomes and growing production capacity when it issued its ruling. But it is disappointing that the agency chose not to issue a more comprehensive ruling observing the full contributions of advanced biofuels and unlocking a broader carbon reduction strategy.

There are, however, other silver linings to the EPA’s proposal. The agency deserves credit for increasing volumes for certain advanced biofuels, like biomass-based diesel. Their decision is a nod to the low-carbon fuel industry’s achievements and the sector’s proven capacity to deliver hundreds-of-millions of gallons of renewable diesel, biodiesel, and SAF. It also signals that the agency is working to reward fuel producers that help achieve carbon reduction targets, which will encourage even more firms to become involved in the production of low-carbon fuels.

It’s also important to note that the agency’s ruling has symbolic weight as the first opportunity for the EPA to determine annual fuel blending requirements independent of federal statutory guidelines in what is colloquially known as the “set” process. The agency’s decision to increase volumes in the biomass-based diesel pool suggests that the EPA values the role that advanced biofuels play in our energy transition and should bode well for future RVO rulings, as well as our emissions reductions strategy writ large.

Policymakers and environmental leaders in Washington must get this right for the American people and the planet. The EPA’s latest ruling is a good start in the right direction. In the meantime, America’s low-carbon fuel producers will continue to deliver important carbon reductions outcomes that will help America achieve its climate ambitions and build a better future for all.

Michael McAdams is president of the Advanced Biofuel Association