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Thursday, September 07, 2006

EPA Proposes National Renewable Fuels Standard - 3.71% for 2007

[From Green Car Congress:]

EPA Administrator Stephen L. Johnson today proposed a Renewable Fuel Standard (RFS) Program designed to double the US use of renewable fuels such as ethanol and biodiesel. The program, authorized by the Energy Policy Act of 2005, will promote use of fuels largely produced by American crops.

The new regulation proposes that 3.71% of all the gasoline sold or dispensed to US motorists in 2007 be renewable fuel. Last December, EPA issued a rule implementing the Energy Policy Act’s default standard of 2.78% for 2006, which will continue to apply through this calendar year.

The EPA must set the standard for each succeeding year representing the amount of renewable fuel that a refiner, blender, or importer must use, expressed as a percentage of gasoline sold or introduced into commerce.

This yearly percentage standard is to be set at a level that will ensure that the total renewable fuel volumes will be used based on gasoline volume projections provided by the Energy Information Administration (EIA). The standard for each year must be published in the Federal Register by November 30 of the previous year.

Various renewable fuels can be used to meet the requirements of RFS program, including ethanol and biodiesel. While the RFS program provides the certainty that a minimum amount of renewable fuel will be used in the United States; more can be used if fuel producers and blenders choose to do so.

In 2006, there will be about 4.5 billion gallons of renewable fuel consumed as motor vehicle fuel in the United States. The RFS program requires that this volume increase to at least 7.5 billion gallons by 2012. The RFS program is designed to cut petroleum use by approximately 3.9 billion gallons a year in 2012—roughly 1.0 to 1.6% of the petroleum that would otherwise be used by the transportation sector—and reduce greenhouse gas emissions by up to 14 million tons annually.

This proposal also provides a preliminary analysis of the expected emissions, air quality and economic impacts of the expanded use of renewable fuels:

  • A reduction of 1.3% to 1.6% in carbon monoxide emissions from gasoline-powered vehicles and equipment;

  • A reduction of 1.7% to 6.2% in benzene emissions;

  • A reduction of 0.4% to 0.6% of the anticipated greenhouse gas emissions form the transportation sector in the US (9 to 14 million tons); and

  • An increase of between 28,000 and 97,000 tons of volatile organic compounds plus oxides of nitrogen (VOC + NOx). The effects will vary significantly by region. EPA estimates that areas such as New York City, Chicago, and Los Angeles will experience no increase, while other areas may see an increase VOC emissions from 3% to 5% and an increase in NOx emissions from 4% to 6% from gasoline-powered vehicles and equipment.

  • Resources:

  • EPA Renewable Fuel Standard Program

  • Proposed rulemaking: Renewable Fuel Standard Program

  • Renewable Fuel Standard Program Draft Regulatory Impact Analysis

  • It's worth noting, that (as the article mentions) 4.5 billion gallons of biofuels are expected to be consumed in 2006, meaning that the 4.7 billion gallons target for 2007 isn't much of a stretch. This standard doesn't appear to be driving renewables quite as much as the ban on MTBE as an oxygenate (and its subsequent replacement with ethanol), at least so far. In later years, the standard may outpace other market drivers.

    It's also worth noting that while the billions of gallons of gasoline mentioned above sound like big numbers, this standard amounts to a whole lot of nothing when you consider the scale: the renewable fuels standard will reduce total petroleum consumption in the transportation sector by just 1-1.6% by 2012. To be fair, a 1% reduction isn't nothing, but it does dwarf in comparison to the kinds of petroleum reductions that we must - and certianly can - achieve in order to reduce our reliance on mostly imported and increasingly expensive oil and to mitigate and stabalize our impact on global climate change.

    From next-generation biofuels (BTL synthetics, cellulosic ethanol, biobutenal, etc.) to plug-in and grid-indepent hybrids and from vehicle downsizing to increased fuel efficiency, we could easily slash both petroleum imports and greenhouse gas emissions if the will was there. Perhaps President Bush ought to be looking West towards the Governator for ideas about what a concerted effort to reign in petroleum use and greenhouse gas emissions really looks like. Maybe this is why the Oregonian editorial board recently dubbed Gov. Schwarzenegger the real 'leader of the free world' on these kinds of issues...

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