EPA Expected So Send Biofuel Quota Draft To White House

The White House is expecting draft biofuel-blending quotas from the Environmental Protection Agency imminently, according to Bloomberg.

The EPA’s draft blending requirements is the precursor for the agency’s official proposal for exactly how much renewable fuel refiners must mix into gasoline and diesel for 2022.

The final proposal from the EPA is expected within weeks.

Bloomberg sources said that some lawmakers have been told to brace for relatively unchanged requirements—or even a reduction in the amount of renewable fuel that must be blended, much to the ire of the corn lobby.

The EPA was unable to come up with a decision last year during the pandemic by the November deadline, which would have set the Renewable Fuel Standards for 2021. 

The battle between oil refiners and the corn lobby is an old one, creating a political divide that makes its appearance in every U.S. election.

And now, there is a new monkey wrench in the works. Fearing that rising agricultural commodity prices could raise the costs for bread and donut makes, the American Bakers Association (ABA) lobbied the Biden Administration in July to stop the rising mandates for biofuel blending.  The ABA met with the EPA during the last week of July to discuss the matter.

Unlike last year, it is not the pandemic that has slowed the biofuel decision-making. Rather, it is competing interests—including farmers and refiners, as well as the ABA—which are lobbying the new administration hard.

And perhaps both sides are lobbying extra hard this year, as the slump in fuel demand continues to squeeze refiners. On the other hand, the Biden Administration cannot afford to alienate the farmers, either, who have relied on the blending requirements as another outlet for corn.

By Julianne Geiger for Oilprice.com

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