Get Ready, Get Set Go! EPA Sets Renewable Volume Obligations for 2023 and Beyond

November 10, 2021

I have two siblings, which means the phrase “ready, get set, go” gives me anxiety. Inevitably, one of my siblings would start before any of us and the game went steadily downhill from there. Similarly, EPA is currently on the “get set” phase of setting volumes for the Renewable Fuel Standard (RFS) for 2023 and beyond…but isn’t jumping ahead of anyone.

Just as a quick little reminder, for the RFS, the year 2022 Is. Not. A. Sunset. Date. *ahem* Now that we’ve got that out of the way, EPA is statutorily required to set the RVOs for 2023 and beyond by considering a multitude of factors and completing a series of steps. First, EPA is required to consider the impacts of the RFS on a whole host of things including but not limited to:

  • the impact of the production and use of renewable fuels on the environment, including on air quality, climate change, conversion of wetlands, ecosystems, wildlife habitat, water quality, and water supply[1];
  • the impact of renewable fuels on the energy security of the United States[2];
  • the expected annual rate of future commercial production for renewable fuels, including advanced biofuels in each category[3];
  • the impact of renewable fuels on the infrastructure of the United States, including deliverability of materials, goods, and products other than renewable fuel, and the sufficiency of infrastructure to deliver and use renewable fuel[4]
  • the impact of the use of renewable fuels on the cost to consumers of transportation and on the cost to transport goods[5]; and
  • the impact of the use of renewable fuels on other factors, including job creation, the price and supply of agricultural commodities, rural economic development, and food prices[6].

*Whew* that’s a lot of stuff! Basically, EPA has to use an accumulation of factors to ensure that it correctly promulgates RVOs for 2023 and beyond. In a way, it’s kind of like making sure all your sibling knows the rules before you play a game…in which one of you will inevitably cheat because they “forgot the rules.” #siblingrivalry.

When it comes to setting the volumes themselves, EPA is required to observe some statutory mandates. Each separate fuel category, such biomass-based biodiesel and cellulosic ethanol, have statutory requirements to be set at a rate either greater than the volumes set for the calendar year of 2022 or set at a volume that would not require EPA to use its cellulosic waiver authority. Essentially, EPA is not allowed to the move the RFS backwards. Further, EPA is required by law to release these volumes at least 14 months prior to the first month of implementation[7]. Since the first month of implementation will be January 2023, this puts the release date around November-ish.

So, EPA just gets to say what happens and no one else has any say? No, absolutely not. These volumes are not created in a vacuum. EPA is required to consult with the Department of Energy (DOE) and the Department of Agriculture (DOA). Imagine trying to “consult” with your siblings…the answer is always going to be go get mom. To that end, remember, the RFS could not exist without the aid of additional industries, namely industries like agriculture that are integral in the production and use of feedstocks. By requiring EPA to consult with the DOE and the DOA, the law is ensuring that these volumes are created from a realistic standpoint, allowing the RFS to grow and proliferate.

Ok, so, we’re less than 14 months out, why aren’t these volume available to the public yet? It is November after all. Did you see all the things that EPA is required to consider before releasing RVOs for 2023 and beyond? Imagine trying to get three different government agencies to coordinate while also paying attention to every single statutory requirement of the impact of the RFS while also trying to do what’s best for the industry that will result in the fewest number of lawsuits. It’s a bit like trying to get you and all your siblings in the same room, at the same time, without anybody throwing any punches…it might take some time and effort. #callingformomworks. Giving EPA a break while it tries to figure things out is, at the very least, understandable. Plus, participants still have an entire year before they have to really begin worrying about this. I think participants in the RFS would much rather EPA take its time so that it meets the letter of the law rather than rush to release RVOs.

Even with all that being said, EPA’s proposal for volumes beyond 2023 is listed on the OMB’s agenda. Once EPA has sent them a draft proposal, OMB can review it for publication. When the draft proposal has been sent to the OMB, “get set” to see what the future brings. #nojumpstarts.

[1] 42 U.S.C. § 7545(o)(2)(B)(ii)(I).

[2] 42 U.S.C. § 7545(o)(2)(B)(ii)(II).

[3] 42 U.S.C. § 7545(o)(2)(B)(ii)(III).

[4] 42 U.S.C. § 7545(o)(2)(B)(ii)(IV).

[5] 42 U.S.C. § 7545(o)(2)(B)(ii)(V).

[6] 42 U.S.C. § 7545(o)(2)(B)(ii)(VI).

[7] 42 U.S.C. § 7545(o)(2)(B)(ii)(VI).