White House Plans Five Percent Increase in RFS 2020 Blending Mandates

The Trump Administration is drafting a plan that would increase blending mandates under the RFS by five percent over 2019 volumes. The White House, EPA and Department of Agriculture are formulating final details of the plan. The increase in blending mandates are important to petroleum marketers because it could drive up RIN prices and force E15 on the market. The administration is taking this action in order to shore up support among farmers who are angry over falling crop prices from stagnant ethanol blending volume and loss of market share due to the recent increase in small refinery blending waivers and ongoing trade war with China.

According to reports, the Trump Administration is planning to increase total renewable fuel volumes by an additional billion gallons over the 20.4 billion-gallon total already set by the EPA in a recent rulemaking. Specifically, the plan seeks to increase the conventional renewable fuel blending mandate by 500 million gallons for 2020. The advanced biofuel blending mandate would also raise by 500 million gallons while the 2021 bio-mass based diesel blending level would fall by 250 million gallons. The administration’s plan is unlikely to satisfy renewable fuel producers because the higher blending volumes are not sufficient to offset the 4.2 billion gallons of renewable fuel lost to small refinery blending waivers. The plan’s expected unveiling could happen as soon as October 1.