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January 13, 2017

Petition For Waiver Of 2016 Cellulosic Biofuel Volumetric Requirements

Kathleen M Roberts

On December 28, 2016, the American Fuel & Petrochemical Manufacturers (AFPM) submitted a petition requesting that EPA waive the cellulosic biofuel volumetric requirements for the 2016 compliance year citing an inadequate domestic supply of the fuel.  Based on the amount of cellulosic fuel produced through November, AFPM estimated that between 173.8 and 190 million gallons will be produced in 2016, which is approximately 40 to 60 million gallons below the 230 million gallon target set by EPA in December 2015.  With a cellulosic waiver credit price of $1.33 for 2016, obligated parties would be required pay approximately $50 to $75 million to meet the cellulosic biofuel mandate.  The petition requests that a partial supplemental cellulosic biofuel waiver equal to the shortfall be granted to prevent am unjust penalty on obligated parties.  Since RFS compliance must be confirmed by March 30, 2017, the petition also urges EPA to defer the 2016 cellulosic biofuel waiver credit requirement until EPA can formally act on the petition.