Reuters writers Jarrett Renshaw and Stephanie Kelly reported late last week that, “President Joe Biden’s administration, under pressure from labor unions and U.S. senators including from his home state of Delaware, is considering ways to provide relief to U.S. oil refiners from biofuel blending mandates, three sources familiar with the matter said.
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“The issue pits two of the administration’s important political constituencies against each other: blue-collar refinery workers and farmers who depend on biofuel mandates to prop up a massive market for corn.
“It could prompt an about-face for the administration, which had been rolling back former President Donald Trump’s dramatic expansion of waivers for U.S. refiners from the Renewable Fuel Standard.”
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The Reuters writers explained that, “The law requires them to blend billions of gallons of ethanol and other biofuels into their fuel each year or buy credits from those that do.
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“The credits, known as RINs, are currently at their highest price in the program’s 13-year history, and refiners have said the policy threatens to bankrupt fuel makers already slammed by sinking demand during the pandemic.”
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“Biofuel advocates counter that fuel makers should have invested in biofuel blending facilities years ago and can pass through added costs for buying credits,” the Reuters article said.
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Meanwhile, DTN writer Todd Neeley reported last week that, “Twenty-two members of the House biofuels caucus asked U.S. Secretary of Agriculture Tom Vilsack to help the ethanol and biodiesel industries following the COVID-19 economic shutdown that led to reductions in biofuels production.
“In a letter to Vilsack on Wednesday, the lawmakers said producers need assistance to rebuild the industry.
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“‘As you look to provide additional relief under the Pandemic Assistance for Producers program using funds from the Consolidated Appropriations Act of 2021, we request that a portion of those $6 billion in funds are used to assist the biofuels industry,’ the letter said.”
Mr. Neeley added that, “The ethanol industry has been on a roll lately, as the price of Renewable Identification Numbers, or RINs, have been higher and profitable margins have returned to much of the industry following a difficult 2020.”