The headquarters of the United States Environmental Protection Agency (EPA) in Washington, D.C., U.S., February 18, 2025.
The EPA granted 63 exemption requests in full, 77 partially, and denied 28, addressing nearly all 204 requests pending since 2016. These exemptions involve approximately 5.34 billion Renewable Identification Numbers (RINs), the compliance credits generated by blending biofuels into the U.S. fuel supply, according to EPA data. However, due to the two-year lifespan of RINs, only 1.39 billion remain valid for compliance purposes.
The American Fuel and Petrochemical Manufacturers, representing oil refiners, did not provide immediate comments on the EPA’s decision. Meanwhile, Growth Energy, a biofuel trade group, urged the EPA to offset the exempted volumes by increasing blending obligations for other refiners, a process known as reallocation. Growth Energy CEO Emily Skor stated: “It is imperative that EPA reallocates each and every exempt gallon in a forthcoming rule to mitigate the potentially devastating impact on biofuel demand.”
The EPA announced plans to propose a rule soon to address the reallocation of exempted volumes. Sources familiar with the matter indicated that this supplemental rule might be released late next week, though the EPA did not confirm a specific timeline.
Following the announcement, renewable fuel credits tied to ethanol blending rose to over $1.16 each in afternoon trading, up from $1.07 the previous day. The RFS requires U.S. refiners to blend billions of gallons of biofuels into the fuel supply or purchase RINs from those who do, aiming to support farmers and enhance domestic energy supplies. Small refineries can seek exemptions by demonstrating financial hardship.
With the recent approvals, only 13 exemption requests remain pending, according to EPA data. The decision reflects ongoing efforts to balance the needs of small refiners with the goals of the RFS, while addressing concerns about maintaining biofuel demand in the U.S. energy market.
