Inhofe Statement on EPA’s Announced RVO Levels for the RFS

WASHINGTON - U.S. Sen. Jim Inhofe (R-Okla.), chairman of the U.S. Senate Environment and Public Works (EPW) Committee, released the following statement today regarding the U.S. Environmental Protection Agency’s (EPA) final rule for the Renewable Fuel Standard (RFS) volume requirements for 2014, 2015, and 2016:

"The Renewable Fuel Standard as a whole is remarkably flawed. The premise of this program was based on a number of assumptions that no longer reflect reality, like gasoline demand. Furthermore, the EPA continuously fails to properly administer the program and chronically misses deadlines for proposing and finalizing volume requirements, which has led to the rule summarizing three years’ worth of obligations at once instead of issuing the mandates annually. How can program participants plan for their blending requirements for a specific year when EPA doesn’t set them until years later? EPA’s cycle of retroactive mandates falsely inflates the price of the program’s compliance credits, which in turn has resulted in a volatile market and completely unstable program.”

The final rule for 2016 breaches the blendwall by increasing the ethanol volumes from 13.25 billion gallons, as proposed, to 14.5 billion gallons while also increasing the volumes for advanced biofuel to 3.61 billion gallons, and for total renewable fuel to 18.11 billion gallons.

The new rule walks back EPA’s former acknowledgement that there are constraints in the market's ability to consume renewable fuels at the volumes required in future years: EPA’s proposal last year officially recognized for the first time that there is a limit to how much ethanol can safely be blended into gasoline, frequently called the “blendwall.” Gasoline containing concentrations of ethanol higher than 10 percent, or “E10,” has been shown to damage vehicles, boats, motorcycles, and even small engines like those in lawn mowers and snowmobiles.

 EPA is required under the Clean Air Act to finalize volumes by Nov. 30 of the prior year. Only the 2016 volumes from today’s rule are issued on time.