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The Clean Air Act requires the EPA to promulgate regulations that specify the annual volume requirements for renewable fuels under the Renewable Fuel Standard (RFS) program. Standards are to be set for four different categories of renewable fuels: cellulosic biofuel, biomass-based diesel (BBD), advanced biofuel, and total renewable fuel. The statute requires the standards be finalized by November 30 of the year prior to the year in which the standards would apply. In the case of biomass-based diesel, the statute requires applicable volumes be set no later than 14 months before the year for which the requirements would apply. This action would propose the applicable volumes for all renewable fuel categories for 2017, and would also proposed the BBD standard for 2018.

Overall Description of Deadline: Statutory November 30

Statement of Need:

The Clean Air Act section 211(o) specifies annual volume requirements for renewable fuels under the Renewable Fuel Standard (RFS) program. Standards are to be set for four different categories of renewable fuels: cellulosic biofuel, biomass-based diesel (BBD), advanced biofuel, and total renewable fuel. The statute requires the standards be finalized by November 30 of the year prior to the year in which the standards would apply. In the case of biomass-based diesel, the statute requires applicable volumes be set no later than 14 months before the year for which the requirements would apply. This action would, as required by law, propose the applicable volumes for all renewable fuel categories for 2017, and would also proposed the BBD standard for 2018.

Summary of the Legal Basis:

Clean Air Act section 211(o) requires EPA to implement the Renewable Fuels Standard Program. The CAA requires that the Agency set annual volume requirements for four different categories of renewable fuels: cellulosic biofuel, biomass based diesel (BBD), advanced biofuel, and total renewable fuel. The statute requires the standards be finalized by November 30 of the year prior to the year in which the standards would apply.

Alternatives:

Application of specific provisions for this program are set forth in the law. The law requires standards be established annually. The only alternatives authorized under the law are those which allow for waiving in whole or in part the volumes of renewable fuel for which the standards apply.

Anticipated Costs and Benefits:

Illustrative cost scenarios will be prepared during development of the rule. The short time frame provided for the annual renewable fuel rule process does not allow sufficient time for EPA to conduct a comprehensive analysis of the benefits of the standards, and the statute does not require it. Moreover, the costs and benefits of the RFS program as a whole are best assessed when the program is fully mature in 2022. We continue to believe that this is the case, as the annual standard-setting process encourages consideration of the program on a piecemeal (i.e., year to year) basis, which may not reflect the long-term economic effects of the program. Therefore, for the purpose of the annual rulemaking, we are preparing illustrative cost impacts.

Risks:

Failure to set RFS annual standards would create uncertainty in the marketplace as to the volumes of renewable fuels that are required for blending in transportation fuels.