Renewable fuel standard: mend it, don’t end it

While the current RFS policy is by no means flawless, however, and some of the current implementation issues would necessitate statutory changes, the authors say it would be more efficient for these changes to be made by the Environmental Protection Agency (EPA), as opposed to Congress.

“We recommend that Congress simply amend the RFS’ statutory provisions to grant the EPA the authority to address its implementation issues via the regulatory rulemaking process,” Kesan said. “For example, the RFS’s volumetric mandates need to be adjusted to reflect current biofuel production realities. But since Congress has demonstrated an inability to properly set these mandates in the past, it would be more efficient for the EPA to set the RFS mandates for future years through a formal rulemaking process with input from all affected stakeholders.”

“It’s clearly a step in the right direction that the EPA has finally initiated rulemaking to address the issue of RIN fraud and help promote liquidity in the RIN market,” Slating said.

RIN stands for renewable identification number, a number assigned to a given amount of biofuel by the EPA so that its production, use and trading can be tracked.

Although the biggest issue with traditional biofuels usually can be reduced to the food vs. fuel argument, the researchers stress that if the RFS is successful in achieving its goals, it will usher in the use of emerging biofuels that will have significantly less impact on food-related markets.

“The ultimate goal of the RFS is to incentivize the increased commercialization of second-generation biofuels, such as cellulosic biofuels that do not rely on food-related feedstocks for their production,” Slating said. “But in order to efficiently accomplish this goal, the RFS also must continue to incentivize the use of first-generation biofuels like corn ethanol.”

“In the short-term, if any food vs. fuel tradeoffs result from the RFS’ implementation, they will likely be minimal and probably justified in order to effectuate the long-term goal of facilitating the widespread adoption of second-generation biofuels.”

Kesan and Slating’s study also notes that the RFS has only been fully implemented in its current form for three years, and legislatively revising it in an overly reactionary manner would be ill advised at this point.

“Stakeholders and markets must be given time to adjust to the existing regime before serious and informed discussion about significantly altering the RFS, beyond what we propose, can be had,” Kesan said. “Likewise, you’ve got to allow some time for the maturation of this pioneering and socially beneficial renewable energy policy.”

The Energy Biosciences Institute, supported in part by BP, funded the study.

— Read more in Timothy A. Slating and Jay P. Kesan, “The Renewable Fuel Standard 3.0?: Moving Forward with the Federal Biofuel Mandate,” NYU Environmental Law Journal (forthcoming); posted to the Social Science Research Network (29 July 2013)