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The Renewable Fuel Standard (RFS): Waiver
Authority and Modification of Volumes
Kelsi Bracmort
Specialist in Agricultural Conservation and Natural Resources Policy
May 21June 29, 2015
Congressional Research Service
7-5700
www.crs.gov
R44045
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The Renewable Fuel Standard (RFS): Waiver Authority and Modification of Volumes
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Summary
Federal law requires that transportation fuels contain a minimum amount of renewable fuel. This
renewable fuel standard (RFS)—established by the Energy Policy Act of 2005 (EPAct05; P.L.
109-58) and amended by the Energy Independence and Security Act of 2007 (EISA; P.L. 110140)—includes scheduled volume mandates that grow each year (starting with 9 billion gallons in
2008 and ascending to 36 billion gallons in 2022). Within the overall RFS there are sub-mandates
for advanced biofuels, including cellulosic biofuel, biomass-based diesel, and other advanced
biofuels. The Environmental Protection Agency (EPA), which is responsible for administering the
RFS, has the authority to waive the RFS requirements, in whole or in part, if certain conditions
outlined in statute are present. More specifically, the statute identifies a general waiver and
waivers for two types of advanced biofuel: cellulosic biofuel and biomass-based diesel. The
statute requires EPA to announce each year’s standards by November 30 of the previous year,
except for biomass-based diesel, which has an earlier announcement deadline. Further, the final
section of the waiver provision—which some refer to as the “reset” section—allows for a
modification of the applicable volumes of the RFS starting in 2016 if certain conditions are met.
Several instances have led to EPA using, proposing to use, or being petitioned to use its waiver
authority when implementing the RFS. For example, actual production of cellulosic biofuel at the
volumes required to meet the RFS cellulosic biofuel mandate has not been achieved. For various
reasons, the cellulosic biofuel industry has, by a wide margin, been unable to produce the volume
amounts identified in statute. Thus, EPA has issued cellulosic biofuel waivers repeatedly from
2010 through 2013. For instance, under the cellulosic biofuel waiver authority, EPA reduced the
2013 mandate for cellulosic biofuels from the statutory volume of 1 billion gallons to 810,185
ethanol-equivalent gallons. EPA has not granted a general waiver, even when petitioned to do so
by a group of states in 2008 and 2012.
The potential for full or partial RFS waivers can contribute to uncertainty—for policymakers,
industry, financial supporters, and other interested parties. This is especially true when final
annual standard announcements are delayed, partly because a waiver(s) has been proposed. This
is the case for the 2014 and 2015 proposed standardstandards, for which in November 2013 EPA proposedEPA proposes to use
both the
general waiver authority and the cellulosic biofuel waiver authority to reduce the 2014
volume amounts
required for both total renewable fuel and advanced biofuel. EPA also was
petitioned by fuel providers to issue a waiver for the 2014 standards. It proposed to lower the total
In May 2015, EPA re-proposed the
2014 volume requirements and issued the 2015 and 2016 proposed volume requirements. For
instance, EPA proposes to lower the 2014 total renewable fuel mandate from 18.15 billion gallons
to 15.2193 billion gallons. The agency’s
reasoning includes the amount of ethanol that can be
blended into gasoline (e.g., the blend wall)
leading to “inadequate supply” concerns and the
inability of industry to produce sufficient
volumes of advanced biofuel. EPA has not yet issued the 2014 final standard, nor has it issued the
2015 proposed or final standard. In the meantimeanticipates it will
finalize volume requirements for 2014, 2015, and 2016 by November 30, 2015. Although EPA
has not yet issued the 2014 or 2015 final standard, biofuel producers, obligated parties, and others
continue to operate, but they do so in an uncertain RFS environment. In April 2015, EPA
announced it will re-propose the 2014 volume requirements and issue the 2015 and 2016
proposed volume requirements by June 1, 2015, and that it will finalize volume requirements for
2014, 2015, and 2016 by November 30, 2015 (some of which was agreed to by a consent decree,
and some of which EPA is proposing to do outside the scope of the consent decree).
This report discusses the process and criteria for EPA to waive various portions of the RFS, and
the modification of applicable volumes.
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Contents
Introduction...................................................................................................................................... 1
RFS Requirements ........................................................................................................................... 1
RFS Annual Volume Reduction Deadlines ...................................................................................... 2
Current RFS Requirements .............................................................................................................. 32
Biofuel Production ........................................................................................................................... 3
RFS Waiver Provision...................................................................................................................... 4
General Waiver .......................................................................................................................... 5
Cellulosic Biofuel Waiver.......................................................................................................... 5
Biomass-Based Diesel Waiver ................................................................................................... 5
Modification of Applicable Volumes ......................................................................................... 6
RFS Waiver Authority Use .............................................................................................................. 6
Current RFS Waiver Requests ......................................................................................................... 6
RFS Waiver Impacts ........................................................................................................................ 7
Impacts of the RFS Modification-of-Applicable-Volumes Section ................................................. 87
Figures
Figure 1. Scheduled Renewable Fuel Standard (RFS) Mandates Under EISA ............................... 2
Tables
Table 1. EISA and EPA Proposed 2014, 2015, and 2016 RFS Requirements ................................................................ 3
Table 2. Actual Biofuel Production.................................................................................................. 4
Contacts
Author Contact Information............................................................................................................. 8
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The Renewable Fuel Standard (RFS): Waiver Authority and Modification of Volumes
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Introduction
The Renewable Fuel Standard (RFS) requires that renewable fuel be blended into the nation’s
transportation fuel supply.1 This mandate—established in the Energy Policy Act of 2005 (EPAct;
P.L. 109-58) and expanded in the Energy Independence and Security Act of 2007 (EISA; P.L.
110-140)—requires the use of renewable fuel, but it does not explicitly require the production of
renewable fuel. Obligated parties, such as refiners or importers of gasoline or diesel fuel, are
responsible for complying with the RFS requirements. The Environmental Protection Agency
(EPA) administers the mandate, which is an amendment of the Clean Air Act, under its authority
to regulate fuels.2 The statutory renewable fuel volume amounts increase annually until 2022,
with EPA determining the volume amounts after 2022 within certain limitations.
The RFS is a complex and highly technical policy initiative. It deals with multiple sectors and
some advanced renewable fuel technologies that have yet to reach maturity. The RFS also
incorporates greenhouse gas emission reduction thresholds. All of this complexity is combined
with multiple stakeholders that have unique perspectives of what the RFS should accomplish,
how it should be implemented, and whether it should even exist, which leads to intense
discussions about the RFS and its future. Congressional debate about the RFS is expected to
continue, particularly about how EPA administers the program.3 As Congress proceeds with
discussing the RFS, it may be useful to understand the RFS waiver authority granted to EPA. This
report discusses the waiver provision of the RFS, including the modification-of-volumes section.
RFS Requirements
The RFS statute calls for the consumption of 9 billion gallons of total renewable fuel in 2008 and
ascends to 36.0 billion gallons in 2022. The statute identifies four categories of renewable fuels
that must be used to meet the mandate, but essentially these four categories can be aggregated
into two major categories: unspecified biofuel (i.e., cornstarch ethanol) and advanced biofuel (i.e.,
cellulosic biofuel, biomass-based diesel, and other advanced biofuels). (See Figure 1.) Over time,
the growth in the RFS slowly transitions from consisting primarily of biofuels made mostly from
food and feed crops to biofuels made from non-food and non-feed crops. If actual renewable fuel
production were to match what is in the statute for 2022, advanced biofuels would constitute
close to 60% of the 36.0 billion gallon mandate and unspecified biofuel would constitute about
40%.
1
For more information on the Renewable Fuel Standard (RFS), see CRS Report R43325, The Renewable Fuel
Standard (RFS): In Brief, by Kelsi Bracmort.
2
Clean Air Act, Section 211(o); 42 U.S.C. 7545.
3
Legislation has been introduced in the 114th Congress that would repeal or modify the RFS (S. 1584, S. 577, S. 934,
H.R. 434,
H.R. 703, and H.R. 704). The 113th Congress held seven hearings related to the RFS or renewable fuels.
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The Renewable Fuel Standard (RFS): Waiver Authority and Modification of Volumes
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Figure 1. Scheduled Renewable Fuel Standard (RFS) Mandates Under EISA
Billion Gallons
40
30
20
10
0
2008
2010
2012
2014
2016
Unspecified (Corn Ethanol)
2018
2020
Advanced Biofuel
2022
Sources: Congressional Research Service (CRS) with mandates in the Energy Independence and
Security Act of
2007 (EISA; P.L. 110-140).
RFS Annual Volume Reduction Deadlines
Congress gave the EPA Administrator waiver authority to adjust the renewable fuel volume
amounts identified in statute given certain conditions (e.g., inadequate domestic renewable fuel
supply).4 The EPA Administrator is required to set all of the standards by November 30 of the
preceding year (e.g., the 2014 standard should have been announced by November 30, 2013).5
When the EPA Administrator reduces the cellulosic biofuel volume amount, she also may reduce
the total renewable fuel and total advanced biofuel volume amounts by the same or a lesser
volume. For biomass-based diesel, the statute specifies volume amounts for four years (20092012) and requires EPA to announce the remaining annual biomass-based diesel volume amounts
“14 months before the first year for which such applicable volume will apply” (e.g., the 2014
biomass-based diesel standard should have been announced by November 2012).
Current RFS Requirements
EPA has not yet issued the 2014 standard or the 2015 standard. In May 2015, the agency reproposed the 2014 volume requirements and issued the 2015 and 2016 proposed volume
4
5
4
5
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These conditions are further explained in the “RFS Waiver Provision” section of this report.
42 U.S.C. 7545 (o)(3)(B)(i).
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Current RFS Requirements
EPA has not yet issued the 2014 standard or the 2015 standard.6 The agency issued a proposed
rule for the 2014 standard on November 29, 2013.7 EPA announced that it will re-propose volume
requirements for 2014 (that reflect the volumes of renewable fuel that were actually used in 2014)
and issue the 2015 and 2016 proposed volume requirements as well as the 2017 biomass-based
diesel volume requirements by June 1, 2015.8 EPA also announced it will finalize volume
requirements.6 EPA anticipates it will finalize volume requirements for 2014, 2015, and 2016 by
November 30, 2015. The RFS statutory requirements
for 2013, 2014, 2015, and 2016 and the 2014 proposed requirements and the EPA proposed requirements for
2014, 2015, and 2016 are provided in Table 1.
Table 1. EISA and EPA Proposed 2014, 2015, and 2016 RFS Requirements
(in billions of gallons)
Total
Renewable Fuel
Advanced Biofuel (cellulosic
biofuel component)
Unspecified
Biofuel
2013
16.55
2.75 (1.0)
13.8
2014
18.15
3.75 (1.75)
14.4
2014 EPA
Proposal
15.2193
2.20 (17.0 million68 (0.033)
13.025
2015
20.5
5.5 (3.0)
15.0
2016
22.25
7.25 (4.25)
15.0
Year
Sources: EISA (P.L. 110-140); U.S. Environmental Protection Agency, “2014 Standards for the Renewable Fuel
Standard Program; Proposed Rule,” 78 Federal Register 71732-71784, November 29, 20132015 EPA
Proposal
16.3
2.9 (0.106)
13.4
2016
22.25
7.25 (4.25)
15.0
2016 EPA
Proposal
17.4
3.4 (0.206)
14.0
Year
Sources: EISA (P.L. 110-140); U.S. Environmental Protection Agency, “Renewable Fuel Standard Program:
Standards for 2014, 2015, and 2016 and Biomass-Based Diesel Volume for 2017; Proposed Rule,” 80 Federal
Register 33099, June 10, 2015. All volumes are ethanol-equivalent.
Biofuel Production
One indicator of whether the goals of the RFS are being met is actual renewable fuel gallons
produced.97 Cornstarch ethanol is the dominant biofuel produced in the United States. The actual
volumes produced for both unspecified biofuel and biomass-based diesel were in alignment with
what the RFS required (see Table 2). Cellulosic biofuel production is not as easy to quantify.
Measurable amounts of cellulosic biofuel production have begun only over the last year, and
some of the production may not be reported.
6
For more information, see CRS Report IN10189, EPA Delays Decision on 2014 Renewable Fuel Standard to 2015.
U.S. Environmental Protection Agency, “2014 Standards for the Renewable Fuel Standard Program; Proposed Rule,”
78 Federal Register 71732-71784, November 29, 2013.
8
Some of these commitments were agreed to via a consent decree; others were not. For more information, see U.S.
Environmental Protection Agency, “Renewable Fuels Volume Standards Timeline Announced,” April 2015.
9U.S. Environmental Protection Agency, “Renewable Fuel Standard Program: Standards for 2014, 2015, and 2016 and
Biomass-Based Diesel Volume for 2017; Proposed Rule,” 80 Federal Register 33099, June 10, 2015. For more
information on the proposed volume requirements, see CRS Report R43325, The Renewable Fuel Standard (RFS): In
Brief, by Kelsi Bracmort.
7
For simplicity purposes, this section discusses actual fuel production as a measure of RFS accomplishment. It could
be argued that a better RFS accomplishment indicator is the Renewable Identification Numbers (RINs) generated each
year, which take into consideration the energy content of the fuel with an equivalence value. A RIN is a credit that is
assigned to each gallon of renewable fuel, and each year obligated parties are to submit a certain number of RINs to
Environmental Protection Agency (EPA) to demonstrate RFS compliance. There has been a host of issues with RINs,
leading with price volatility and transparency concerns. For more information on RINs, see CRS Report R42824,
Analysis of Renewable Identification Numbers (RINs) in the Renewable Fuel Standard (RFS), by Brent D. Yacobucci.
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Table 2. Actual Biofuel Production
(in billions of gallons)
RFS
Unspecified
Biofuel
Requirement
Actual U.S.
Ethanol
Productiona
RFS
BiomassBased Diesel
Requirement
Actual
BiomassBased
Dieselb
RFS Cellulosic
Biofuel
Requirement
Actual
Cellulosic
Biofuelc
2009
10.5
10.9
0
0.55
0
—
2010
12.0
13.3
1.15
0.31
0.0065
0
2011
12.6
13.9
0.80
1.10
0
0
2012
13.2
13.2
1.00
1.10
0
0.00002d
2013
13.8
13.3
1.28
1.80
0.006
0.0005e
2014
14.4
14.3
1.28
1.75
1.75
0.033f
Year
Sources: EISA (P.L. 110-140); U.S. Environmental Protection Agency RFS Final Rules.
Notes: RFS requirements for 2014 are the statutory requirements, except for the biomass-based diesel
requirement, which EPA was authorized to set starting in 2013.
a.
Renewable Fuels Association, Historic U.S. Fuel Ethanol Production, 2015.
b.
National Biodiesel Board, Production Statistics, 2015; National Biodiesel Board, “National Biodiesel Board
Calls for EPA to Act on RFS,” press release, January 30, 2015.
c.
EPA Moderated Transaction System (EMTS) RFS2 Data.
d.
Production amount from cellulosic ethanol (20.1 thousand gallons.) and cellulosic diesel (1.0 thousand
gallons).
e.
Production amount from cellulosic renewable gasoline (281.8 thousand gallons) and cellulosic diesel (232.8
thousand gallons).
f.
Renewable compressed natural gas (CNG) and renewable liquefied natural gas (LNG) consisted of
approximately 98% of the 2014 cellulosic biofuel production total (728.5 thousand gallons of cellulosic
ethanol; 29.4 thousand gallons of cellulosic renewable gasoline; 5.2 thousand gallons of cellulosic diesel; 50.4
thousand gallons cellulosic heating oil; 15.2 million gallons of renewable CNG; 17.4 million gallons of
renewable LNG). EPA reports that 2014 was the first year where some Renewable Identification Numbers
were generated using imported cellulosic biofuel, specifically cellulosic heating oil.
RFS Waiver Provision
The RFS statute contains a waiver provision.108 The provision contains three waivers that the EPA
Administrator may use—a general waiver, a cellulosic biofuel waiver, and a biomass-based diesel
waiver—to waive, in whole or in part, the volume of renewable fuel mandated by the RFS. If a
waiver is issued, it expires after one year, but the Administrator may renew the waiver.
Additionally, the waiver provision allows for a modification of applicable volumes. The waivers
and the modification of applicable volumes are described in further detail in the following
sections of this report.
10
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42 U.S.C. 7545(o)(7).
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General Waiver
The general waiver gives the EPA Administrator the authority to waive the RFS requirements, in
whole or in part, if
1. there is inadequate domestic renewable fuel supply to meet the mandate, or
2. implementation of the requirement would severely harm the economy or
environment of a state, a region, or the United States.119
The Administrator may issue the general waiver at her discretion or if petitioned by a state or fuel
provider. In those instances in which the Administrator receives a petition for a waiver, she has 90
days after receipt of the petition to approve or disapprove the petition. Further, prior to making
her decision, the Administrator is to consult with the Secretaries of Agriculture and Energy and to
allow for public notice and the opportunity for comment. If a general waiver is granted, any
adjustment applies to the total national renewable fuel requirement. Thus, EPA may not issue a
general waiver to waive the requirement for an individual state or supplier within a state. To date
EPA has not granted a waiver under this provision, but it has proposed doing so for 2014., 2015,
and 2016.10
Cellulosic Biofuel Waiver
The cellulosic biofuel waiver obligates the EPA Administrator to reduce the cellulosic biofuel
mandate when the projected volume amount for a given year is less than what is identified in
statute.1211 As written, the law does not require the EPA Administrator to consult with the
Secretaries of Agriculture or Energy when issuing a cellulosic biofuel waiver, or to give public
notice and opportunity for comment, but the Administrator must base the projection on the U.S.
Energy Information Administration estimate provided under the applicable percentages
provision.1312 Although it is not written in statute, EPA consultation has been carried out with
federal agencies, industry, and others when EPA has discussed issuance of a cellulosic biofuel
waiver, and opportunity for public comment also has been provided. The Administrator must set
the new required amount at the “projected available volume during that calendar year” by
November 30 of the preceding year. Should the Administrator reduce the cellulosic biofuel
volume, she also may reduce the volumes of advanced biofuel and renewable fuel by the same or
lesser volume. When a cellulosic biofuel waiver is issued, the Administrator must offer cellulosic
biofuel waiver credits for obligated parties to purchase for that compliance year.1413
Biomass-Based Diesel Waiver
The biomass-based diesel waiver gives the EPA Administrator the authority to reduce the amount
of biomass-based diesel mandated for up to 60 days if she determines that there are significant
market circumstances (including feedstock disruptions) “that would make the price of biomassbased diesel fuel increase significantly.”15 If these market circumstances continue past the initial
11
42 U.S.C. 7545(o)(7)(A).
42 U.S.C. 7545(o)(7)(D).
13
42 U.S.C. 7545(o)(3)(A).
149
42 U.S.C. 7545(o)(7)(A).
U.S. Environmental Protection Agency, “Renewable Fuel Standard Program: Standards for 2014, 2015, and 2016
and Biomass-Based Diesel Volume for 2017; Proposed Rule,” 80 Federal Register 33099, June 10, 2015.
11
42 U.S.C. 7545(o)(7)(D).
12
42 U.S.C. 7545(o)(3)(A).
13
The formula to calculate the price of these credits is written in statute. For more information on cellulosic biofuels
and the RFS, see CRS Report R41106, The Renewable Fuel Standard (RFS): Cellulosic Biofuels, by Kelsi Bracmort.
15
42 U.S.C. 7545(o)(7)(E); for more information on biodiesel, see CRS Report R41282, Agriculture-Based Biofuels:
(continued...)
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market circumstances (including feedstock disruptions) “that would make the price of biomassbased diesel fuel increase significantly.”14 If these market circumstances continue past the initial
60-day period, the Administrator may issue another waiver for an additional 60 days. The
Administrator is to consult with the Secretaries of Energy and Agriculture prior to issuing such a
waiver. If the Administrator issues a biomass-based diesel waiver, she also may reduce the
volumes of advanced biofuel and renewable fuel by the same or lesser volume.
Modification of Applicable Volumes
The modification-of-applicable-volumes section of the RFS is referred to by some as the “reset”
section for the RFS.1615 This section gives the EPA Administrator the authority to adjust the
applicable volumes of the RFS starting in 2016 if certain conditions are met. Specifically, it
requires that, starting in 2016, the EPA Administrator modify the applicable volumes of the RFS
for subsequent years if the Administrator waives the renewable fuel mandate, the advanced
biofuel mandate, the cellulosic biofuel mandate, or the biomass-based diesel mandate by at least
20% for two consecutive years or by at least 50% for a single year. The section does not state that
the Administrator must “reduce” the volume amount, nor does it allude to what the modified
amount must be (i.e., projected available volume during that calendar year).
RFS Waiver Authority Use
Thus far, the EPA Administrator has issued only cellulosic biofuel waivers. Indeed, the
Administrator has done so repeatedly, issuing cellulosic biofuel waivers in 2010, 2011, 2012, and
2013.1716 The Administrator has not granted a biomass-based diesel waiver or a general waiver,
even when petitioned to do so by states in 2008 and 2012.1817 The 2014 RFS , 2015, and 2016 RFS
proposal included
waivers for cellulosic biofuel, advanced biofuel, and total renewable fuel
(including a lowering of
the unspecified portion).
Current RFS Waiver Requests
If the time frame written in law for determining waivers had been met, stakeholders already
would be aware of their 2015 RFS obligations and possibly could be in discussions with EPA
about a forthcoming 2016 proposed rule. However, the 2014 and 2015 standards—due November
30, 2013, and November 30, 2014, respectively—have not yet been issued by EPA. As a result,
the present RFS discussion is focused on what the 2014, 2015, and 2016 RFS standards will be
and what waiver authority may be used.
(...continued) The 2014, 2015, and 2016 proposed rule was released in
14
42 U.S.C. 7545(o)(7)(E); for more information on biodiesel, see CRS Report R41282, Agriculture-Based Biofuels:
Overview and Emerging Issues, by Mark A. McMinimy.
1615
42 U.S.C. 7545(o)(7)(F).
1716
The EPA Administrator used the cellulosic biofuel waiver in 2010 to reduce the mandate from the statutory volume
of 100 million gallons to 6.5 million ethanol-equivalent gallons, in 2011 from 250 million gallons to 6.0 million
ethanol-equivalent gallons, in 2012 from 500 million gallons to 10.45 million ethanol-equivalent gallons, and in 2013
from 1 billion gallons to 810,185 ethanol-equivalent gallons. EPA’s 2012 standard was vacated by a court decision, and
in its 2014 proposed rule for the RFS EPA proposes to rescind the 2011 cellulosic biofuel standard.
1817
For more information on waiver petitions from the states, particularly for 2008 and 2012, see CRS Report RS22870,
Waiver Authority Under the Renewable Fuel Standard (RFS), by Brent D. Yacobucci.
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The 2014 proposed rule was released in November 2013, giving some indication as to what
waivers EPA may use for 2014. In its 2014 proposed rule, EPA suggestsMay 2015. EPA proposes using both the general
waiver authority and the cellulosic biofuel
waiver authority to reduce the volume amount for both
advanced biofuel and total renewable fuel.
Its reasons include the blend wall19wall18 and the inability of
industry to produce sufficient volumes of advanced biofuel. More specifically, EPA states the
following:
Relying on its Clean Air Act waiver authorities, EPA is proposing to adjust the applicable
volumes of advanced biofuel and total renewable fuel to address projected availability of
qualifying renewable fuels and limitations in the volume of ethanol that can be consumed in
gasoline given practical constraints on the supply of higher ethanol blends to the vehicles
that can use them and other limits on ethanol blend levels in gasoline.
There are two different authorities in the statute that permit EPA to reduce volumes of
advanced biofuel and total renewable fuel below the volumes specified in the statute. When
we lower the applicable volume of cellulosic biofuel below the volume specified in [the
Clean Air Act] 211(o)(2)(B)(i)(III), we also have the authority to reduce the applicable
volumes of advanced biofuel and total renewable fuel by the same or a lesser amount. We
can also reduce the applicable volumes of advanced biofuel or total renewable fuel under the
general waiver authority provided at [Clean Air Act] 211(o)(7)(A) under certain conditions.
Today’s proposal uses a combination of these two authorities to reduce volumes of both
advanced biofuel and total renewable fuel to address two important realities:
• Limitations in the volume of ethanol that can be consumed in gasoline given practical
constraints on the supply of higher ethanol blends to the vehicles that can use them and other
limits on ethanol blend levels in gasoline—a set of factors commonly referred to as the
ethanol ‘‘blend wall’’
• Limitations in the ability of the industry to produce sufficient volumes of qualifying
renewable fuel.20
EPA announced in April 2015 that it will re-propose volume amounts for 2014 and issue the 2015
and 2016 proposed volume by June 1, 2015. Further, some fuel providers have petitioned EPA for
a partial waiver of the 2014 standard.21 EPA reports that it expects to issue a determination on the
petitions at the same time it issues the 2014 final rule.
RFS Waiver Impacts
Waiver authority can impact RFS implementation and market confidence, as well as contribute to
RFS uncertainty. Waiver authority is intended to assist EPA with timely administration of the
19
The blend wall is the upper limit of how much ethanol can be blended into gasoline. In general, only a certain
amount of ethanol can be blended into gasoline for use in vehicles and other equipment. Currently, much of the RFS is
being met with ethanol. Since the RFS is a volume mandate, it is possible that the RFS could require more biofuel (e.g.,
ethanol) than can be blended into gasoline. Thus, some are concerned the blend wall is in direct conflict with the
biofuel volumes mandated by the RFS. For more information, see CRS Report R40445, Intermediate-Level Blends of
Ethanol in Gasoline, and the Ethanol “Blend Wall”, by Kelsi Bracmort.
20
U.S. Environmental Protection Agency, “2014 Standards for the Renewable Fuel Standard Program; Proposed Rule,”
78 Federal Register 71732-71784, November 29, 2013.
21
American Petroleum Institute and American Fuel & Petrochemical Manufacturers, “Petition for Partial RFS Mandate
Waiver,” August 13, 2013.
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industry to produce sufficient volumes of
advanced biofuel.19
RFS Waiver Impacts
Waiver authority can impact RFS implementation and market confidence, as well as contribute to
RFS uncertainty. Waiver authority is intended to assist EPA with timely administration of the
RFS. In practice, it appears to have done the opposite, contributing to the delay of final standards.
Waiver authority, in conjunction with other factors, could weaken confidence in renewable fuels
policy and the chosen technologies, specifically cellulosic biofuel.2220 Many aspects of the RFS and
biofuels could be viewed as unsteady (e.g., approval of fuel pathways for the RFS, bringing
advanced biofuels on line at a sizeable scale, issuing federal support for biofuels, biofuel
infrastructure) partly because Administration decisions—including the use of RFS waiver
authority—have not been made in a timely manner.
Impacts of the RFS Modification-of-ApplicableVolumes Section
There are questions and concerns about how EPA will implement the modification-of-applicablevolumes section of the RFS in 2016. These concerns are partly due to the history of cellulosic
biofuel volumes being reduced by significant percentages every year, making it very likely that
the modification-of-applicable-volumes section will be implemented for cellulosic biofuels. Also,
it is not clear how the section will be implemented. Moreover, the Administrator has the sole
discretion to set the modified amounts, which in theory could be similar to what is listed in statute
already or completely different. There may be questions about whether the impact of the
modification section could be contained to one advanced biofuel (e.g., cellulosic biofuel) or
whether there would be a domino effect whereby other renewable fuels were impacted. Lastly, if
the modification section were implemented for cellulosic biofuels, with EPA drastically lowering
the cellulosic biofuel volumes, would the opportunity to satisfy one of the original purposes of the
policy be undermined (i.e., promoting a steep expansion in the use of advanced biofuels)? Going
forward, the implementation of this section could have important implications for the biofuel
industry, with a potential for EPA to significantly reduce the applicable volumes or to maintain
ambitious targets.
Author Contact Information
Kelsi Bracmort
Specialist in Agricultural Conservation and Natural
Resources Policy
kbracmort@crs.loc.gov, 7-7283
22
Advanced Ethanol Council, “33 Advanced Biofuel Companies Ask President Obama to Reconsider the Proposed
RFS Rule for 2014,” press release, May 16, 2014; Advanced Ethanol Council, “AEC, BIO Joint Letter to White House
over Proposed 2014 RFS Volumetric Blending Requirements,” October 29, 2013.
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The blend wall is the upper limit of how much ethanol can be blended into gasoline. In general, only a certain
amount of ethanol can be blended into gasoline for use in vehicles and other equipment. Currently, much of the RFS is
being met with ethanol. Because the RFS is a volume mandate, it is possible that the RFS could require more biofuel
(e.g., ethanol) than can be blended into gasoline. Thus, some are concerned the blend wall is in direct conflict with the
biofuel volumes mandated by the RFS. For more information, see CRS Report R40445, Intermediate-Level Blends of
Ethanol in Gasoline, and the Ethanol “Blend Wall”, by Kelsi Bracmort.
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For more information on EPA’s proposal, see CRS Report R43325, The Renewable Fuel Standard (RFS): In Brief,
by Kelsi Bracmort and CRS Report IN10294, The Renewable Fuel Standard (RFS): EPA Releases the Proposed Rule
for 2014, 2015, and 2016, by Kelsi Bracmort.
20
Advanced Ethanol Council, “33 Advanced Biofuel Companies Ask President Obama to Reconsider the Proposed
RFS Rule for 2014,” press release, May 16, 2014; Advanced Ethanol Council, “AEC, BIO Joint Letter to White House
over Proposed 2014 RFS Volumetric Blending Requirements,” October 29, 2013.
Congressional Research Service
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The Renewable Fuel Standard (RFS): Waiver Authority and Modification of Volumes
industry, with a potential for EPA to significantly reduce the applicable volumes or to maintain
ambitious targets.
Author Contact Information
Kelsi Bracmort
Specialist in Agricultural Conservation and Natural
Resources Policy
kbracmort@crs.loc.gov, 7-7283
Congressional Research Service
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