The biofuels headwinds remain strong. Last month I wrote about how natural gas in affecting the biofuels industry, specifically how no one could have foreseen the impact of gas on the original tenets of the Renewable Fuel Standard (RFS), which mandate 36 billion gallons of renewable fuels by 2022. In January of this year, a court decision was reached for the lawsuit against the cellulosic volume requirement by the RFS.
On one hand, the appeals court ruled in favor of the Environmental Protection Agency (EPA) saying that the organization’s methods of setting a volume target each year were acceptable. But, it also stated that the EPA’s methods for coming up with higher targets to help spur industry growth were not. In the end, nothing really changes much as cellulosic targets will still be established for the U.S. by the EPA.
This week, the RFS is again in the news, not for the macro forces it faces, rather for the competing forces in Washington DC’s continued debate about the need for biofuels. Biofuels supporters are in the process of countering a very recent effort by the Smarter Fuels Coalition, which is trying to repeal the RFS. There is some senate support against the use of biofuels, but there is just as much support on the other side of the debate that supports these alternatives.
One thing that is lost in these disagreements is that many seem to equate biofuels to ethanol. In fact, the core disagreement about the RFS is about ethanol and not about the host of other drop-in biofuels in the pipeline. Where this ends up, who knows? Ethanol and drop-in biofuels are not going away anytime soon, neither is the passion on both sides of this debate.