Biofuel and oil company leaders are headed back to the White House on Monday in an effort to end the current impasse over the Renewable Fuel Standard.
One proposal being floated by oil company representatives would put a cap on prices for Renewable Identification Numbers, or RINs, which are required to comply with the RFS.
“NFU opposes a cap on RIN prices because it would undermine the RFS and disincentivize blending of homegrown, renewable fuels in our transportation sector,” said National Farmers Union president Roger Johnson. “Not only is a RIN cap harmful to American agriculture, it is a sellout of farmers and a handout to refiners. The administration should simply lift the summertime restriction on the sale of E15, which would both boost ethanol production and decrease costs for refiners by instituting new RINs.”
The American Soybean Association likewise opposes the RIN cap, which has been proposed by Sen. Ted Cruz, R-Texas.
“Placing any cap on the price of RINs is a misguided step that destroys demand for biodiesel and other renewable fuels,” said ASA President John Heisdorffer, who farms in Keota, Iowa. “Analysis from the National Biodiesel Board and the World Agricultural Economic and Environmental Services shows up to 300 million gallons in biomass-based diesel volumes would be lost each year as these volumes would no longer be utilized for compliance with the RFS conventional biofuels requirements.”
“RFS stakeholders, including petroleum refiners, have stated that biodiesel is not a problem, yet all of the proposed RFS revisions would first and foremost adversely impact biodiesel,” Heisdorffer said. “Reduced biodiesel production equals reduced demand for soybean oil, hurting the bottom line for soybean farmers and adversely impacting rural economies. We’re already facing great market uncertainty as a result of the tariffs and trade issues. Action to cap RIN prices and undermine the RFS will exacerbate the economic damage to farm families like mine.”
Source: ASA, NFU