US lifts biofuel mandate in blow to oil companies

24 Nov 2016   Biofuels

The White House handed a victory to the corn ethanol industry and dismayed oil companies by requiring US cars and trucks to burn more biofuels next year.  The rule finalised on Wednesday will require a 6 per cent increase in the use of renewable fuels to 19.28bn gallons in 2017. While well below the 24bn gallons originally mandated by law, it nevertheless drew cheers from biofuel advocates fighting limited domestic distribution of their product.  The US renewable fuel standard (RFS) set out ambitious targets for biofuel consumption when passed by Congress in 2007. Ethanol and biodiesel are blended with conventional petrol and diesel for use in vehicles. But the targets became unachievable as engines grew more efficient and national fuel consumption stalled after the financial crisis. The oil industry’s refusal to add more than 10 per cent ethanol to most of its petrol further capped demand. As well, the development of cellulosic ethanol made from fibrous biomass-like stalks and switchgrass has fallen short of early hopes. The Environmental Protection Agency has tried to boost volumes while acknowledging market realities.

Comments are closed.