US EPA begins process to restore lost RFS demand from refinery exemptions

The U.S. EPA sent to the White House Office of Management and Budget for review its draft rule Oct. 2 to reallocate the Renewable Fuel Standard volumes lost due to 29 refinery exemptions granted in August.

At the time, EPA stated it would “propose to reallocate 100 percent of the… [exempted volumes]… into the 2026 and 2027 renewable volume obligations (RVOs) before the end of October 2026.”

“IRFA is pleased to see the process move on time,” said Monte Shaw, executive director of the Iowa Renewable Fuels Association. “Missing the October deadline would send the wrong message at the wrong moment. Earlier this year, the EPA’s robust RFS rule helped spur biofuels demand and prompted idled plants in Iowa to resume production. Any delay would create unnecessary uncertainty and call into question the reallocation commitment. We don’t want to see biofuels plants go back offline. We’re watching this closely and thank the EPA for moving forward.”

Nearly all proposed agency rules go through OMB’s interagency-review process before being formally proposed.

Once cleared, the agency can propose a draft rule, take public input and ultimately finalize a rule.

“EPA's decision to fully restore waived RFS volumes was a big win,” added Shaw. “As opposing interests will continue to try to derail the reallocation plan, markets want to see that EPA is on track to get the rule done on time. Farmers and biofuels producers are counting on EPA to provide the market certainty that will power growth opportunities.”