Daily Torch: For several years the Renewable Fuel Standard (RFS) has placed an undue burden on the consumers and producers of transportation fuel. It became clear early in the implementation of the RFS it had significant flaws, but special interests have fought reform for fear of losing their gravy train. The RFS has turned nothing more than a government subsidy for the farmers. It is time to return competition to the transportation fuel market and repeal the RFS.
In 2005, Congress passed, and President Bush signed the Energy Policy Act of 2005. Among the many new regulations created in the legislation, the RFS was birthed. The RFS mandated a certain amount of renewable fuels, mostly corn ethanol, be blended with gasoline. The amount was 4 billion gallons in 2006 with a rise to 7.5 billion in 2012.
In 2007, the Energy Independence and Security Act of 2007 was passed. The bill increased the amount of renewable fuel to be blended. It required 9 billion gallons be blended in 2008 with an increase to 36 billion gallons in 2022. The increase amounted to a massive government ordered subsidy to be paid to biofuel producers.
Each refiner has a Renewable Volume Obligation (RVO) that is given to them by the EPA. A Renewable Identification Numbers (RIN) is a tracking number used for biofuels. To ensure every refiner is following the laws outlined in the 2005 and 2007 acts the EPA devised a way to track each batch of biofuel. Refiners must have a certain amount of RINs to meet its RVO. If a refiner does not have the capability to blend biofuel, it must purchase a RIN from another refiner that can produce RINs. A government mandate forcing a private company to buy a product it doesn’t need or want, where have we heard this before?
The largest refinery on the East Coast was just bankrupted by the RFS. MORE