Summary of Interagency Working Comments on Draft Language under EO 

12866 and EO 13563 Interagency Review. Subject to Further Policy Review.

EO 12866 Interagency Comments on U.S. Environmental Protection Agency (EPA) draft final

rule titled, “Renewable Fuel Standard Program: Standards for 2014, 2015, and 2016 and 

Biomass-Based Diesel Volume for 2017,” RIN 2060-AS22

1. BBD: The commenter would like EPA to consider whether the environmental safeguards 

written into the law can supersede some of the grandfathered palm oil biodiesel imports. For 

example, BBD falls into the advanced biofuels category and thus is expected to have a 50 

percent reduction in greenhouse gas emissions. With indirect land use change, it is almost 

certain that imported palm oil biodiesel does not qualify. If the safeguards cannot apply, this 

reviewer strongly suggests reducing the BBD requirement (and the subsequent requirements in 

higher nests). It is not helping the environment to push these levels and a reasonable read of 

the legislation suggests that it was not Congress’ intent to encourage palm oil biodiesel imports.

Response: All fuel that qualifies for the BBD standard (D4) must meet the 50% GHG lifecycle 

reduction threshold. There is currently no pathway for producing BBD from palm oil, however 

palm oil may be used in grandfathered biodiesel and renewable facilities to produce conventional 

(D6) biodiesel and renewable diesel. Reducing the advanced and BBD standards would have no 

impact on the demand for conventional biodiesel and renewable diesel produced from palm oil. 

Reducing the total standard may reduce the demand for these fuels, but would also reduce demand 

for other conventional biofuels such as corn ethanol. Most importantly, reducing the total 

standard to attempt to reduce the incentive for conventional biodiesel and renewable diesel is not 

consistent with EPA’s general waiver authority, which is being exercised on the basis of inadequate 

domestic supply. All potential sources of biofuel must be considered in this context.

2. Conventional biofuels: The commenter is concerned about the increase in conventional biofuels 

implied by the 2016 levels. Given that there is very little environmental benefit from these, the 

only argument for them is to push the infrastructure development. Yet is very apparent that the 

incentives in this market are not leading to major additional infrastructure development in E85. 

There is clear evidence that the passthrough of RIN prices to retail E85 prices is minimal (e.g., 

see Knittel et al. 2015). Given this, the effect of the higher mandate for conventional biofuels 

will likely be to draw down on the RIN bank. These issues appear to be insufficiently discussed. 

Mandating fewer conventional biofuels (closer to the value in the NPRM) seems like a logical 

approach in light of the minimal passthrough (which implies a limited ability to push through 

the blendwall with E85). In a future rulemaking, changing the point of obligation may help with 

this issue, but that is likely too major of a change to make for this final rule.

Response: We discuss extensively our assessment of how much ethanol and biodiesel (both 

advanced and conventional) might be expected to be supplied in 2016 in section II.E. of the 

preamble. With respect to potential E85 volumes, EPA is including two technical memos for

review, one exploring the impact of RIN prices on E85 retail prices and another exploring sales 

responses to E85 pricing. As a result, we have assumed that the potential growth of E85 in 2016 

will be limited, as it requires time for the value of the RIN to impact volumes. Nevertheless, the 

potential volumes of all renewable fuels, including ethanol sold as E85, in 2016 must be taken into 

account in setting the total renewable fuel standard, and we believe the final standard reflects an 

appropriate consideration of all of the potential sources as described in section II.E.
Changing the point of obligation is beyond the scope of this rulemaking.

3. EPA has not provided a sufficient justification that there is adequate domestic supply for the 

waiver level of 3.8 billion gallons of advanced biofuel, and therefore the overall 18.1 billion 

gallons of renewable fuel. If the required volumes of advanced and total biofuel exceed 

adequate supply, it could potentially lead to significant volatility in the D5 and D4 RIN values in 

2016.

The revision in the advanced category (which is primarily accounting for biodiesel and 

renewable diesel fuel) from 3.4 billion gallons to 3.8 billion gallons would require sufficient 

production capacity and market and regulatory conditions sufficient to support these fuels. 

Such conditions existed from 2012 to 2013 and resulted in an increase on the same order as 

that proposed from 2015 to 2016. At the time, biodiesel was one of the only available market to 

transportation fuel blenders to readily meet their RFS obligation because of the E10 blendwall. 

Additionally, the biodiesel blenders tax credit was available providing additional incentive to 

produce and blend biodiesel. On the other hand, the RFS itself could drive improved regulatory 

conditions that would spur real world production from the estimated 2.8 billion gallons of 

existing biodiesel capacity and the expected 375 million gallons of capacity that appears to be 

planned or under construction. Further, the Senate is currently considering an extension of the 

biodiesel tax credit similar to what was available in the past.

EPA should either change the advanced biofuels volume and overall requirements in 2016 to be 

consistent with the current justification or update the justification with additional data or other 

resources to support the higher level and submit the updated justification for interagency 

review.

Response: EPA has made updates to the preamble text to justify the production of 2.5 billion 

gallons of biodiesel in 2016. We note that this would not necessarily require any additional 

production capacity; as the comment above states, there is already sufficient biodiesel production 

capacity. We expect that once again biodiesel and renewable diesel will be the fuels most available 

to meet the increasing RFS standards, as the consumption of higher level ethanol blends will once 

again be limited. We think it is reasonable to assume 2.1 billion gallons of the biodiesel and 

renewable diesel is advanced biofuel, accounting for 3.15 billion advanced RINs. We believe the 

remaining 450 million gallons can be met with a combination of biogas (about 210 million 

gallons), advanced ethanol (about 200 million gallons), and other advanced fuels such as heating 

oil and naphtha (about 25 million gallons).

4. The commenter recommends strengthening the language to indicate EPA’s intention to 

continue to set aggressive standards that work towards the statutory targets to provide 

certainty despite a requirement for annual rulemaking. This serves two purposes. First this 

recognizes the long planning horizon needed for advanced and cellulosic biofuel deployment. In 

addition, it ensures that the market barriers currently used to justify use of the general waiver 
are expected to be overcome and will not serve as a permanent cap on the volume of biofuels in 

the market.

Response: We have added some text to Section I.D in an attempt to clarify our intentions 

regarding future standards.

5. The commenter supports the notice of intended action to enable a robust bioprocessing 

industry with co-processing, in which production can occur at multiple facilities while still 

generating RINs. This action can enable companies to leverage, share, and co-fund existing and 

new infrastructure to reduce cost. With extensive experience in GHG LCA analysis, the 

commenting agency can support EPA in determining GHG implications of co-processed 

products to ensure accurate accounting while meeting the intent of the rule.

Response: Support noted.

6. The draft final standard requires 380 million gallon more than the blendwall. The proposed 

standard from May appears to have only required 310 gallons more than the blendwall. The 

incremental 70 million gallons is more than what would correspond to the increase in actual 

gasoline demand (which is incorporated into blendwall calculations).

a. How did EPA arrive at the 380 million gallons difference? Why not more/less? How does this 

correspond to the accounting on page 112 which has a difference of 1.12 vs. 0.84 in the draft? Is 

that a better measure of stringency in the final vs. the draft?

Response: The draft final rule does not indicate that the final standards would result in ethanol 

volumes that exceed the blendwall by 380 million gallons. While the 2016 volume of conventional 

renewable fuel exceeds the blendwall by 580 million gallons, this comparison is only a relevant 

benchmark for parties who view the conventional renewable fuel pool as being composed only of 

ethanol. As discussed in Section II.E.2.i, the conventional renewable fuel "requirement" is expected 

to include some non-ethanol renewable fuels. 

As discussed in Section II.E.3, we considered the contribution that biodiesel and renewable diesel 

can make to the total supply of renewable fuel, and then determined in Section II.F the portion of 

that volume which was reasonably attainable as advanced biofuel. The difference between the 

total renewable fuel and advanced biofuel volume requirements is the portion of total renewable 

fuel that is not required to be advanced biofuel. Based on this approach, we expect that some 

biodiesel and renewable diesel would contribute to the conventional renewable fuel 

"requirement". 

The purpose of Table II.G-1 in the final rule (corresponding to Table II.D.2-1 in the NPRM) is not to 

demonstrate the stringency of the total renewable fuel volume requirement vis-a-vis the blendwall 

per se, but rather to describe the options available to the market for supplying volumes of 

renewable fuel in excess of the blendwall and minimum expected volumes of non-ethanol 

renewable fuel. 
b. What is the purpose of this greater stringency given that EPA does not expect the standard to 

lead to significantly more E85 penetration in 2016, has alternative levers to increase biodiesel 

production and imports, and wants to maintain a RIN buffer at current levels?

Response: We do not believe that the comparison suggested (580 mill gal in the final rule versus 

310 mill gal in the NPRM) suggests greater stringency of the final volume requirements compared 

to those we proposed. Instead, they reflect a consideration of additional information and analyses 

that has become available since the NPRM, including comments provided by stakeholders. Based 

on a consideration of this additional information, we have determined that the market can supply 

more renewable fuel in 2016 than we had expected when we released the NPRM. In short, the 

higher volume requirements in the final rule reflect greater opportunities for supply than we had 

expected.

c. Congress certainly intended the RFS to breech the blendwall, but does EPA have reason to 

believe Congress intended to do this with conventional biofuels? How about with imported 

conventional biofuels? If it is not clear, then does EPA support this goal and pushing up total 

volumes a climate-friendly and economically efficient way to accomplish this?

Response: First, to be clear, the E10 blendwall is an ethanol issue. Since ethanol can be produced 

as both conventional biofuel (i.e., corn ethanol) and advanced biofuel (i.e. sugarcane ethanol), 

increases in ethanol production and penetration into the market, either as conventional or 

advanced would add to the volume that could breech the E10 blendwall. Similarly, ethanol is also 

both produced domestically in the U.S. and imported to the U.S. from other countries and the 

statute does not allow EPA to discriminate between domestically-produced and imported biofuels 

from qualifying under the RFS program.

However, the blendwall is also not just an ethanol issue. The RFS standards can go well beyond the 

E10 blendwall through the use of other renewable fuels. In fact the total RFS standard is over 4 

billion gallons beyond the E10 blendwall, providing tremendous incentive for market growth of 

both ethanol and non-ethanol fuels alike. Furthermorel EPA believes that Congress envisioned the 

majority of growth over time to come from advanced biofuels, as the non-advanced (conventional) 

volumes remain constant in the statutory volume tables starting in 2015 while the advanced 

volumes continue to grow. Renewable fuels represent an opportunity for the U.S. to move away 

from fossil fuels towards a set of lower GHG transportation fuels, and a chance for a stilldeveloping low GHG technology sector to grow. 

The standards we are finalizing for 2016 in particular are consistent with the purpose of the 

statute: to significantly increase the amount of renewable fuel used in the supply of transportation 

fuel over time, particularly renewable fuels with the lowest lifecycle GHG emissions. The final 

volume requirements will push the fuels sector to produce and blend more renewable fuels in 2016 

in a manner that is consistent with the goals Congress envisioned. 

7. The commenter requests EPA to revise the language concerning the Brazilian estimates due to 

their importance as a trade partner for ethanol. US exports to Brazil surged in 2015. One of the 
concerns with the current language is that it implies Brazilian ethanol would be less desirable in 

its RIN category in terms of GHG emissions. 

Response: All advanced biofuels must meet the same minimum 50% GHG reduction requirements, 

and we are not in this rule questioning nor making any attempt to modify our previous 

determination that imported sugarcane ethanol meets this 50% GHG reduction requirement. 

However, as discussed in Section II.F, the potential for "circle trade" could negatively impact the 

expected net GHG benefits of using all forms of ethanol even if it does not directly impact the 

average 61% reduction in GHGs that we determined for imported sugarcane ethanol. We have 

modified the language in Section II.F to clarify this.

8. Please provide the following memos to the docket: 

Footnote 68 (p. 59) Projection of annual renewable fuel supply in 2015

Footnote 77 (p. 73) analysis of historical errors in projections of gasoline and distillate demand 

from EIA

Footnote 87 (p. 77) estimating e85 consumption in 2013

Footnote 90 (p. 79) an assessment of the impact of RIN prices on the retail price of e85

Footnote 94 (p. 82) estimating e0 use in recreational marine engines

Better yet, you might consider asking Peter thought that these memos are good enough.

Response: We are providing drafts of these memos along with this document.

9. p. 93: Suggest deleting “as relative currency valuations” since firms hedge against currency 

fluctuations with financial instruments.

Response: The text has been deleted from the preamble as requested

10. Based on the discussion presented below, the commenter suggests increasing the conventional 

gap by 200 million gallons; i.e., setting the conventional gap to 14.5 billion gallons to address 

the blendwall issue. EPA may want to consider increasing the non-advanced total to 14.5 bgal 

in 2016 to further incentivize pushing beyond the blendwall and a larger increase in the 2017 

biodiesel level to provide an easier path to showing continued progress in growing the 

advanced pot in years beyond 2016. As formulated now, it is more likely that the D6 RIN price 

will not be sufficient to encourage additional and growing levels of sales of higher blends nor 

the investments in infrastructure to facilitate the growing levels of second generation biofuels 

that are required in future years. By increasing the conventional gap by 200 million gallons, 

there will be increased emphasis on meeting the total with higher levels of blended ethanol.

EPA’s expressed interest in showing strong growth in advanced biofuels in future years paired 

with their concerns over biodiesel capacity that led to only a 100 million increase in 2017 has 
the potential to significantly limit the ability of EPA to increase the advanced biofuel volumes 

for 2017 (not set by the proposed rule) without driving significant increases in the import of 

advanced sugar cane ethanol. Without additional incentives to push past the blend wall – say 

by increasing the conventional levels (say to 14.5 bgal in 2016) – the proposed final level by 

EPA’s own logic will lead to a higher level of D6 renewable diesel (palm) for 2017 and out years 

to meet the conventional standard and increase exports of domestically produced ethanol.

Response: We see no basis for the statement “as formulated now, it is more likely that the D6 RIN 

price will not be sufficient...” While no one can predict RIN prices, the current total renewable fuel 

standard of 18.1 billion gallons is set at the maximum reasonably achievable level and is certainly 

expected to result in RIN prices that provide the necessary incentives to the marketplace to make 

the proper investments and take the other actions necessary to achieve the standard. This is as 

true for conventional biofuels as it is for advanced biofuels. The commenter also appears to be 

focused on the E10 blendwall, somehow equating it with conventional biofuels. This is not the 

case. Growth in renewable fuel volumes beyond the E10 blendwall can and will be met with fuels 

other than conventional biofuels. In fact, the total renewable fuel standard is over 4 billion gallons 

higher than the E10 blendwall. We are already well beyond the E10 blendwall, and the standards 

in the final rule will provide a considerable incentive to continue to grow even further beyond it. 

Nevertheless, we have revised the advanced biofuel volume to increase the “conventional gap” by 

200 million gallons as requested.

a. The volumes for 2014 and 2015 are set in such a way as to be RIN neutral in terms of carry-out 

stocks. This approach, particularly for 2014, is consistent with their earlier approach as is their 

approach toward defining ‘available supplies’ as including the ability to retail and consume such 

fuels. In defining it this way they can, and do, switch between physical availability and their 

perception of potential consumption to set the standards for 2016. 

Response: We continue to believe that it is both legitimate and important to distinguish between 

three different elements of supply:

1) Volumes of renewable fuel that can be produced (which includes considerations primarily of 

production capacity and availability of feedstock),

2) Volumes that can be supplied to retail service stations (which includes considerations of 

distribution, blending, and dispensing infrastructure), and

3) Volumes that can be supplied to vehicles and engines (which includes considerations of the 

vehicles/engines that can use renewable fuels and the economic incentives associated with 

customers choosing to use renewable fuels). 

Some stakeholders treat #1 as "physical availability", while others treat #1 and #2 together as 

"physical availability." Regardless, #1 and #2 are not sufficient considerations in determining the 

supply of renewable fuel to vehicles and engines. #3 reflects the market reality that supply of 

renewable fuel to vehicles and engines cannot be assumed to be identical to making renewable fuel 

available to vehicles and engines as transportation fuel in the United States. Instead, physical 

availability and the potential for vehicles and engines to use renewable fuels are both relevant 

considerations.
b. In setting the total standard, in essence setting the amount of fuel that can be consumed beyond 

the advanced mandate, EPA focus’ on ethanol use. From this EPA asserts a limit on E10 

consumption, proposes an E85 consumption level. This is in effect sets ‘supply’ as their 

perceived limits of ‘demand.’ However, when it comes to the other portions of achieving the 

conventional renewable fuel standard of 15.0 billion gallons, they switch to actual physical 

supplies as the limiting factor. 

Table II.B.6-2

Meeting a 15.0 Billion Gallon Allowance for Conventional Renewable Fuel

with Both E85 and Biodiesel (million gallons)

E10 138,916a

E85 400b

Total ethanol 14,188

Non-ethanol (ethanol-equivalent) 812

Non-ethanol (biodiesel-equivalent) 540

Total renewable fuel 15,000

a This level is less than the amount of ethanol that can be used as E10 in all 

2016 gasoline, because some of that gasoline is used in this scenario to 

make E85.

b Assumed to contain 74% denatured ethanol.

Response: This is not entirely accurate. It is true that in estimating the volume of ethanol that 

could be supplied to vehicles in this exercise, we included both the physical availability of ethanol 

and the potential for vehicles and engines to use it as E10 and E85. However, in discussing the 

additional volume of biodiesel that would be necessary to reach 15.0 bill gal of conventional 

renewable fuel, the final rule does not focus on only the physical volumes of biodiesel that could be 

made available. Instead, the text references the many constraints on biodiesel supply that are 

discussed in Section II.E.3, which includes distribution and dispensing infrastructure, engine 

warranties, and cold weather operation. However, there was no need to highlight these particular 

constraints on supply in the context of this exercise since the constraints associated with the 

physical availability of biodiesel were sufficient to demonstrate that the 15.0 bill gal target could 

not be reached.

c. This approach to building up to the conventional volume seems to limit physical availability to 

US production with more limited import response in the case of D4 imports and an explicit 

preference not to fill a higher conventional fuel allowance through D6 biodiesel, all of which is 

imported, despite EPA assertions the fuel origin is irrelevant and instead they appear to seek to 

limit D6 imports due to lower GHG scores of the fuel. So while it may be ‘obtainable’ they chose 

to shift these volumes into the advanced category while also citing physical availability of the 

fuel (before blending) as the constraint on setting mandates at a higher level. So despite those 
D6 fuels being available1, this fuel appears not to be allowed to contribute to a higher mandate 

despite physical availability. One could argue that the availability of this fuel to the market place 

should be incorporated into the setting of the total (and therefore conventional gap) of the 

mandate. 

Response: The final rule does not seek in any way to determine the volume of conventional 

renewable fuel that can be supplied in 2016. Instead, in keeping with the nested nature of the RFS 

standards the final rule determines the supply of total renewable fuel which can be achieved in 

2016, and then determines the portion of the total renewable fuel volume that it is reasonable to 

expect can be advanced biofuel. The resulting volume of conventional renewable fuel is merely the 

outgrowth of the determination of the total and advanced volumes.

Regarding the estimation of advanced versus conventional biodiesel (and renewable diesel), we 

have in fact included substantial volumes of conventional biodiesel in our determination of the 

total renewable fuel volume requirement. As shown in Table II.E.5-1, we have determined that a 

total of 2.5 bill gal of biodiesel can be achieved in 2016. With the revision to the advanced 

standard described above, we now determine that 2.1 bill gal of that biodiesel can reasonably be 

expected to be advanced, as shown in Table II.F-1. Effectively, then, the conventional renewable 

fuel volume is presumed (for the purposes of determining the 2016 volume requirements) to 

include 400 mill gal of conventional biodiesel. This is considerably higher than the actual volume 

of conventional biodiesel projected to be supplied in 2015.

d. When it comes to estimated potential consumption of ethanol in 2016 the error correction for 

2014, which identified ethanol consumption being nearly 350 million gallons higher than EPA 

initially estimated, has no effect on EPA’s perception of potential consumption. That is to say, in 

this instance, estimated future consumption doesn’t seem to be guided by observations of how 

compliance and consumption are today. For example, in the figure below, expectations for 

years beyond 2014 are not influenced by the fact that they had to make a significant (0.2%) 

increase in their 2014 number from the proposed rule. 

 

1 We know this fuel is available for import, if incentives are right, because it is being produced overseas, generates RINs 

which are only then available domestically when the fuel is imported. The creation of the RINs validates the fuels 

physical existence. 
Figure II.E.2-1

Ethanol Concentration of Gasoline

Source: EIA's Short Term Energy Outlook

Response: The correction for 2014 ethanol exports has essentially no bearing on the determination 

of the volumes that can be achieved in 2016 because the 2014 correction merely changed our 

understanding of what actually occurred, not what could have occurred. Moreover, following this 

correction, the poolwide ethanol concentration in 2014 was still less than 10%.2 In contrast, the 

volume requirements for 2016 would result in a poolwide ethanol concentration above 10%.

e. In terms of E85 consumption, the EPA uses ‘demand’ as supply, but here the agency examines

actual E85 consumption at a national level and asserts that RIN prices are not passed through to 

consumers and therefore the mechanism which would incentivize additional E85 consumption 

through RIN prices is ineffective. This discussion which starts on page 74 differs from the 

proposed rule in that an examination of data from Minnesota3, perhaps the most complete E85 

consumption data, was abandoned in the text of the final rule. The Minnesota data suggests that 

at the station level, high RIN prices did lead to discounting E85 to consumers and a significant 

increase in the volume of sales. As the RIN prices quickly returned to lower levels, the 

incentives disappeared and sales fell. This suggests that in fact the mechanism of pass through 

and consumer response does act as economic theory would suggest despite EPA assertions.4 

 

2 Also, Figure II.E.2-1 is based directly on EIA data, which accounts for all gasoline and ethanol actually consumed in 

2014. It likewise shows a poolwide ethanol concentration of less than 10%.

3 https://mn.gov/commerce/energy/images/2015-09Sept-E85.pdf

4 EPA states on page 75: EPA examined available data in an attempt to determine whether or not higher RIN prices 

resulted in lower E85 prices at retail, and whether lower E85 retail prices lead to substantial increases in E85 sales, as 

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

E10 blendwall
The period over which conditions were sufficient to induce additional E85 consumption was as 

short as a few months and indeed not all stations lowered prices. At a national level and over a 

longer period of time, such actions are likely masked in the data. The EPA seems aware that 

such response takes time:

 

(Pg 30). “...In the longer term, sustained ambitious volume requirements are necessary to provide 

the certainty of a guaranteed future market that is needed by investors; the development of new 

technology won't occur unless there is clear profit potential, and it requires multiple years to build 

new production, distribution, and consumption capacity...”

Response: EPA has not abandoned consideration of the Minnesota data in this final rule, rather we 

have considered this data along with sales and pricing data available in several other states in 

addition to just considering data from Minnesota. Even the Minnesota data suggested that the 

RIN value was only passed through in part, and reflected in part in the retail pricing of E85. The 

full value of the RIN was not passed through. The sales volumes, while significant increases in 

percentage terms, were still very small in absolute terms. This is consistent with the nationwide 

data. EPA is including two technical memos for review, one exploring the impact of RIN prices on 

E85 retail prices and another exploring sales responses to E85 pricing. We agree that increasing 

sales volumes of E85 will require time, and this is the primary reason we cannot simply assume 

significant increases in E85 sales volumes in 2016.

f. Such adjustments in the E85 market appear to be judged on a different scale. Further the 

annualized approach to E85 ‘supply’ (consumption) ignores the significant seasonality in E85 

use. If ‘supply’ is evaluated as the ability to consume, then such an ability to consume should be 

judged on a shorter time frame. E85 consumption in 2013, a year with significant volatility in 

RIN prices, was three times higher in August (near the highs of RIN prices) than it was in 

January of the same year. To judge the ability of the market to consume E85 on the average of 

those 12 months vs the reality of the markets ability to consume E85 at peak demand, further 

skews the analysis to favor lower estimated E85 ‘supply’.5 EPA backs away from using E85 to 

expand renewable fuel use but asserts there is no specific support for it. 

(Pg 49) “...However, this general responsibility does not require obligated parties to 

take actions specific to E15 and/or E85 infrastructure, as the RFS program does not 

require ethanol specifically...”

Response: We are not aware of any data demonstrating that E85 use is consistently seasonal 

(independent of the impacts that E85/E10 price ratios have on consumer preferences for E85 

versus E10). 

Our determination of the volumes of E85 that could be achieved in 2016 is based not on the total, 

or even average, E85 volumes that were actually achieved in calendar year 2013 (or 2014, for that 

 

economic theory would suggest would be the case when FFV owners receive better value for purchasing E85 rather than 

E10. 

5 EPA states on page 77: All stakeholders agreed that actual sales of E85 in the past have been low. A number of parties 

referenced certain E85 estimates from EIA of about 77 million gallons in 2014. 
matter). Instead, our estimates of E85 potential were based on a detailed analysis of the nearterm potential for increased use of E85 as a function of the E85/E10 price ratio, which in turn was 

based on a substantial data set that included, but was not limited to, the aforementioned 

Minnesota data.

We disagree that "EPA backs away from using E85 to expand renewable fuel use." On the 

contrary, we have projected growth in E85 use that is based on a detailed analysis of what the 

market can accomplish by the end of 2016 with significant expansion of E85 retail stations and 

reductions in the relative price of E85. It is the data, not EPA, which has resulted in lower E85 

estimates for 2016 than policy aspirations might otherwise dictate.

g. The period of analysis for statements by EPA such as “Although 150 million gallons is about 

twice as high as the estimate provided by EIA, it still does not indicate an overall preference 

among FFV owners for E85 when E85 has been available. Indeed, based on other comments 

received it is clear that the experience at retail has been mixed,“ are at too aggregated a level 

and over to aggregated period of time to fully explore what is a fairly new market dynamic, 

much of the total and conventional mandate levels are built on this assumption by EPA. EPA 

also comments on a primary constraint being E85 station availability, here they seem open to 

further expansion, noting USDA involvement in infrastructure investment6. The concern is of 

course the circularity of the argument as RFS levels which are insufficient to drive E85 

consumption result in low levels of E85 consumption which then lead to lower mandate levels. 

A closer examination of the economic incentives at a more micro scale may suggest greater 

consumer response and justify a more aggressive approach. Again the Minnesota data analysis 

in the proposed rule was dropped in the final. The commenter suggests that EPA incorporate 

the distinction about national level and regional level consumption patterns in the final text to 

allow for the notion that E85 sales can be responsive to RIN prices as evidenced by the MN 

experience. Note also that EIA projects E85 sales in the AEO to be in excess of 300 mgal (or 

270+ million gallons of ethanol content).

Response: We will add a clarification to Section II.E.2.iii to make it clear that the Minnesota data 

was not dropped, but in fact was included with data from other states, as well as data from the 

Fuels Institute, in determining how E85 use varies with the E85/E10 price ratio. The memo 

describing this analysis includes a discussion of the fact that it may be possible that stronger-thanaverage regional (i.e. State-specific) customer responses to E85/E10 price ratios might suggest 

that higher E85 volumes are possible for the nation as a whole. However, since the nation as a 

whole could just as easily exhibit a weaker-than-average customer response to E85/E10 price 

ratios, and there is no data or information to indicate which is more likely, we are compelled to use 

the average response in this final rule.

 

6 EPA states on page 78: A number of stakeholders cited a recent grant program sponsored by USDA that is designed to 

provide a total of $100 million for updated and expanded infrastructure at retail for higher level ethanol blends.6 This is 

an important program that not only demonstrates the U.S. commitment to expanding the use of renewable fuels, but 

helps to boost private investment in infrastructure by providing matching funds. It will undoubtedly increase the 

number of retail stations offering E85, but it is unclear how many new E85 stations would result from it in 2016. 
h. The availability of biodiesel and renewable diesel from grandfathered plants overseas seems to

factor in the allocation of volumes to mandates (shifting it from conventional to advanced 

classifications) instead of being additive to the mandates. That is their availability (as 

determined by RIN generation, not necessarily shipments to the US) is ignored and not additive 

to the mandate but instead this fuel availability is now determined by overseas policies, 

exchange rates and economic incentives to ship to the US. 

Figure II.E.3.iii-1

Biodiesel and Renewable Diesel Imports and Exports (2011-2015)

“...Nevertheless, as evidenced in 2015 we have clearly been experiencing some upward growth in 

imports of biodiesel and renewable diesel. Much of the increase in biodiesel imports in 2015 has 

been from grandfathered facilities that are exempt from the 20% lifecycle GHG reduction 

requirement. Fuel from these facilities qualifies for D6 RINs that can be used to satisfy the total 

renewable fuel standard...” 

On biodiesel imports from Argentina (text below) one has to understand that the data shown

represent import data, that is the monthly data are for when the product arrived at US ports. 

One could expect a significant lag from the announcement of a new policy and the arrival of 

significant volumes. 
Figure II.E.3.iii-1

Imports of Biodiesel from Argentina

Source: Energy Information Administration

“...Additionally, the annualized volume of imported Argentinean biodiesel for 2015, based on data 

collected through July, is 94 million gallons. This level is far less that the potential volumes 

projected by the National Biodiesel Board and several others. Brazil has also just recently 

proposed increasing its biodiesel mandate from 7% to 8% in 2016, which may provide another 

attractive destination for exports of Argentinean biodiesel.7 Finally, Argentina has changed the 

applicable tax on exported biodiesel several times since the beginning of 2015, highlighting the 

uncertainty associated with projecting potential future imports into the U.S.8 Based on these facts, 

we believe that the volume of biodiesel and renewable diesel imported from Argentina in 2016 is 

likely to be far less than the several hundred million gallons suggested by some commenters...”

Response: The availability of biodiesel and renewable diesel from foreign markets impacts both 

the total supply of renewable fuel, as well as the portion of this renewable fuel that can be 

advanced biofuel. In our assessment of available supply we began by projecting the total available 

supply or biodiesel and renewable diesel, including both that which can be produced domestically 

and that which can be produced internationally (at registered facilities) and imported into the 

United States. We determined that total biodiesel and renewable diesel supply can increase by 

approximately 500 million gallons from 2015 to 2016. This was in large part due to the 

availability of product produced in foreign countries such as Indonesia, Singapore, and Argentina. 

We next considered how much of this fuel could be advanced. With the changes described above to 

the advanced biofuel standard in response to these comments we now determine that 2.1 billion 

 

7 "Brazil Proposes Raising Biodiesel Mandate To B10," docket EPA-HQ-OAR-2015-0111.

8 "Argentina changes biodiesel export tax - Biofuels Digest," docket EPA-HQ-OAR-2015-0111.
gallons of the 2.5 billion gallons total biodiesel and renewable diesel could be advanced biofuel. 

This number was chosen to try to maximize the GHG benefits of the RFS program by requiring 

most of the biodiesel and renewable diesel to be advanced biofuel (with a 50% GHG reduction) 

rather than conventional biofuel (20% lifecycle reduction or grandfathered with less). When 

considering potential production from Argentina, we did not solely rely on the monthly import 

records, but also considered other factors, such as increasing domestic demand for biodiesel in 

Argentina and significantly reduced biodiesel production relative to previous years. We do 

recognize the fact that there could indeed be a lag between announcement of a policy shift and a 

response in the market, and we will continue to monitor the level of imports.

i. A comparison of the following tables suggests that the EPA expects imports of 300 million 

gallons (2,500-2,200) of D6 biodiesel and renewable diesel in 2016 (or as much as 450 million 

D6 RIN equivalents). 

1. Table II.E.5-1

Volumes Used To Determine Total Renewable Fuel Supply in 2016

Volume (million gallons) Million RINs

Ethanol 14,051 14,051

Biodiesel and renewable diesel 2,500 3,750

Biogas 210 210

Other non-ethanol renewable fuels 100 100

Total 16,861 18,100a

a We believe it is reasonable to round the sum of 18.11 to 18.10 bill gal.

Table II.F-1

Volumes Used To Determine Advanced Biofuel Supply in 2016

Volume (million gallons) Million RINs

Cellulosic biofuel 230 230

Biodiesel and renewable diesel 2,200 3,300

Imported sugarcane ethanol 200 200

Other non-ethanol 100 100

Total 2,630 3,800a

a We believe it is reasonable to round the sum of 3.83 to 3.80 bill gal.

Those levels suggest that meeting the D6 obligation of approximately 14.3 billion gallons, would 

come from essentially ethanol in E10 that is not advanced, or about 13.85 million gallons, and 

about 450 million gallons of D6 biodiesel and renewable diesel. Imported sugarcane ethanol 

would effectively (at 200 million gallons) meet the E85 assumed sales in 2016 --- a lower level 

than projected by EIA. 

Response: While EPA is projecting approximately 200 million gallons of E85 will be used in 2016 

to meet our standards, it is inappropriate to characterize this volume of E85 as being filled with 

only sugarcane ethanol and only corn ethanol as being used to produce E10. Ethanol produced 

from these two feedstocks is identical, and it is likely that ethanol from both sources will be used to 

produce both E10 and E85. 
While EIA’s AEO may predict more than 200 million gallons of E85, EIA’s most recent STEO (the 

data they say we should use for this rulemaking) projects that in 2016 the share of ethanol in 

gasoline will be 9.9%, which is significantly lower than that assumed by EPA.

Note that, in response to interagency comments, we have changed the final volume requirement 

for advanced biofuel to 3.6 billion gallons.

In the process of determining the volume requirements for advanced biofuel and total renewable 

fuel, we made estimates of the total volume of biodiesel and renewable diesel that could be 

supplied in 2016, and the portion of that volume that was reasonably attainable as advanced 

biofuel. We acknowledge that the implication of these calculations is that 400 mill gal of 

conventional biodiesel and renewable diesel (600 mill RINs) would be used to meet the implied 

14.5 bill gal conventional renewable fuel volume requirement, and that the remaining portion of 

that 14.5 bill gal implied requirement would be met with ethanol. However, this is not a projection 

of how the market will respond to the standards that we set. We described in Section II.G that 

there are many ways that the market could respond, including but not limited to total volumes of 

biodiesel and renewable diesel less than the 2.5 bill gal we used in determining the volume 

requirement for total renewable fuel, and volumes of conventional ethanol higher than those 

implied by Tables II.E.5-1 and II.F-1.

11. (Pg 31) The commenter also suggested deleting the entirety of or the last part of the following 

text: 

“...Constraints on the availability of biodiesel to U.S. consumers could include 

competing uses for feedstocks, international competition for biodiesel, the inconsistent 

nature of the biodiesel subsidy, limited investments to ensure quantity and quality of 

biodiesel product, limited infrastructure to distribute and blend biodiesel, and the 

limited ability of the market to consume biodiesel...”

Response: We do not believe it would be appropriate to delete the last part of the quoted text, as 

these limitations are significant factors in the potential total supply of biodiesel in 2016. This text 

is important for the legal defensibility of this rule.

12. (Pg 46) Provide additional justification of this statement from the literature. The underlined 

text seems very particularly speculative as written:

“... Just as importantly, biodiesel volumes on the order of 5.5 billion physical gallons in 

2016 are far in excess of what could actually be consumed in this short timeframe. This 

volume of BBD would constitute about 10% of the diesel pool in 2016.[1] Although most 

medium and heavy-duty engine manufacturers warrant the use of blends up to B20 in 

their more recent models, some light-duty engine manufacturers do not, and many 

highway and nonroad diesel engines that were produced in the past but are still in use 

today are warranted for no more than 5% biodiesel.[2] Also, as pointed out by 
CountryMark Cooperative Holding Corporation, biodiesel concentrations in the winter 

months are sometimes kept to lower levels by engine owners due to cold weather 

operability and storage concerns, and some parties avoid selling biodiesel at all during 

winter months. Constraints on the use of biodiesel at concentrations above 5% due to 

engine warranty limitations, plus resistance on the part of some parties to using biodiesel 

in winter months, means that a nationwide average of 10% biodiesel in the diesel pool, for 

an entire calendar year, is not reasonably achievable in 2016. We acknowledge that the 

National Biodiesel Board has extensive efforts underway working with the vehicle and 

engine manufacturers to continue to expand product offerings capable of operating on 

B20, working with their membership to improve fuel quality, expanding infrastructure to 

address cold temperature issues, and working with dealers and technicians to clear away 

obstacles standing in the way of expanding biodiesel acceptance in the 

marketplace.[3] There are also efforts to increase the use of biodiesel in heating oil. These 

will continue to bear fruit, allowing the biodiesel volume to continue to rise over time, but 

not to the levels that would be needed in 2016 if 5.5 billion gallons of biodiesel were to be 

required... “

Response: The underlined sentence is merely a summary of the points made in the preceding 

sentences. If it is the points made in the preceding sentences that are considered speculative, it is 

unclear why. Manufacturers only began warranting their engines to operate on B20 in the last 5

years or so, so a large portion of the in-use fleet by definition must have been warranted for only 

B5. Cold-temperature issues with biodiesel are well-known, which is why much of Canada’s 

mandate is met with renewable diesel. We have cited one stakeholder as explicitly stating that 

they avoid blending biodiesel in winter months. We will add some additional citations in footnotes 

to studies discussing cold temperature issues with biodiesel.

13. (Pg 48) Same as above. Provide additional justification of these statements:

“...Even if some portion of the increase were supplied from imports, the total volume of 

biodiesel supplied to diesel engines would more than double in comparison to that 

supplied in 2014, requiring that distribution, blending, storage, and dispensing routes 

would need to be expanded in an extremely short period. We do not believe that this is 

possible in 2016. As a result, we do not believe that the statutory target for advanced 

biofuel can be met in 2016...”

Response: A footnote has been added to clarify.

14. (Pg 97) This language seems to contradict – how can infrastructure be constraining if EPA is 

simultaneously pointing out examples where the infrastructure is clearly not the problem? For 

example, the background data is not supporting the statement that “suggest that increasing the 

number of refueling stations offering biodiesel blends could be a significant constraining factor to 

the supply of biodiesel in 2016.”
“...There is some indication that the number of refueling stations willing or able to market 

biodiesel may become a factor that constrains the growth of biodiesel supply in the United States, 

either in 2016 or in future years. A number of retail locations that market diesel fuel are only 

offering biodiesel blends that exceed 5% (B5), which is the maximum amount of biodiesel for 

which many diesel vehicles are warranted. For example, the LOVES truck stop chain is a major 

retailers of biodiesel. A recent review of their website indicated that 221 of their 354 stations were 

selling B15. This is despite the fact that many of the newer, and especially the older heavy-duty 

diesel truck engines were only designed and warranted for biodiesel blends up to B5. Similarly, in 

the state of Illinois nearly all sales of biodiesel blends are reported to be at B11 in order to benefit 

from the state tax subsidy, despite the fact that not all vehicles and engines have been designed 

and warranted for its use. This may suggest that increasing the number of refueling stations 

offering biodiesel blends could be a significant constraining factor to the supply of biodiesel in 

2016. Were more retail outlets willing and able to dispense biodiesel, then, existing volumes of 

biodiesel could be distributed at concentrations B5 or less without raising any warranty 

concerns...”

Response: We do not believe this language is contradictory. The data shows that the incentive to 

blend more biodiesel has led to at least one party selling only B15 blends, despite the fact that a 

substantial number of their potential customers operate vehicles with engines that are only 

designed and approved to use up to B5. If biodiesel distribution were not constrained, we think it 

much more likely that biodiesel would expand to more stations, rather than higher level blends 

that are problematic for some customers and may turn them away, as nationwide biodiesel use is 

still well under 5% of the diesel pool.

15. The GHG benefits of advanced biofuels relative to conventional biofuels are likely overstated. 

EPA has not updated the analysis of the GHG benefits of conventional biofuels since the RFS was 

put into place. There have been significant improvements in technology and initial concerns of 

GHG from indirect-land use change have not materialized. 

More generally, the EPA assumption that corn ethanol has lower GHG benefits than advanced 

biofuels is based on the conclusion of the life cycle analysis (LCA) that it conducted on corn 

ethanol in as part of the 2010 Regulatory Impact Analysis of the RFS2. This LCA was done in 

2010 and so it reflects a projection of the direct and indirect GHG emissions associated with a 

state-of-the-art natural gas powered ethanol refinery in 2022. The LCA projected 2022 

emissions for the following 11 components of corn ethanol production. 

1. Domestic farm inputs and fertilizer N2O

2. Domestic land-use change

3. Domestic rice methane

4. Domestic livestock

5. International land-use change

6. International farm inputs and fertilizer N2O

7. International rice methane

8. International livestock

9. Fuel and feedstock transport

10. Fuel production

11. Tailpipe
Since 2010,the commenter has new data, improved model capabilities, and empirical studies 

that strongly support the position that corn ethanol is currently on an emissions pathway that is 

much more positive, and will result in a much improved GHG profile in 2022 than was 

determined in EPA’s RIA. For example, with respect to component 5, new data shows that 

between 2003 and 2010 deforestation in the Amazon fell four-fold while U.S. corn ethanol 

production increased four-fold (deforestation in Brazil’s Amazon was the largest component of 

indirect land-use change emissions in the LCA). Similarly, with respect to components 1,6,7,9 

and 10, emissions are estimated using coefficients and other inputs from the Argonne National 

Laboratory’s GREET model. The GREET model has been significantly revised and updated since 

2010. Finally, with respect to components 2 and 5, recent work by Babcock and Iqbal (see: 

(www.card.iastate.edu/publications/dbs/pdffiles/14sr109.pdf ) conclude the primary land-use 

adjustment made by farmers both within the U.S. and internationally to the increased U.S. and 

global demands for (non-palm oil) biofuels was to use existing cropland more intensively 

(including increased double cropping and farm chemical use. Intensification of existing 

cropland was not considered in the EPA 2010 LCA. 

USDA suggests EPA provide some caveats indicating that the lifecycle analyses of petroleum 

fuels and biofuels have likely changed since the 2010 rulemaking and that additional review 

and study is warranted in the near future to assess changes to key parameters used in the 2010 

assessment.

Response: Since the adoption of the RFS program in 2010, a number of studies have been 

conducted suggesting both higher and lower GHG impact compared to the current estimates. 

Without conducting a thorough reanalysis, it would be inappropriate to suggest any directional 

trend in GHG performance compared to the existing analyses. An update we have made is to 

develop the Efficient Producer petition process to allow corn starch and grain sorghum ethanol 

producers to specifically demonstrate superior process efficiency through reduced onsite energy 

consumption, increased fuel output and/or use of low greenhouse gas energy sources to reduce 

process energy greenhouse gas emissions. However, while we continue to review updated data 

and LCA modeling capability for potential future use it does not have any bearing on this 

rulemaking. 

16. What does EPA plan for resetting the mandates in the future? Future investment and growth in 

biofuels capacity and demand will depend on the signals sent by EPA regarding how the 

statutory levels will be reset sometime in the relatively near future. Section I. D. is missing 

discussion of waiver requirements and resetting of the statutory standards.

Response: Resetting the statutory volumes would be the focus of a separate rulemaking and 

therefore is not addressed in this preamble. Regarding future investment and growth in biofuels 

capacity, we believe getting the annual standard setting schedule back on track, including for the 

2017 standards, goes a long way to providing appropriate incentive for expanded biofuel 

production.
17. In discussing the reasons why biofuels have not reached the levels mandated in the RFS2, there 

is no mention of the large drop in the price of petroleum since 2010 (when EISA was passed) or 

the increased domestic and Canadian production of natural gas and petroleum. For example, 

Table II.E.1-1 does not mention petroleum prices. Please provide a discussion of the impact of 

petroleum prices and compliance with the mandate and sales of higher level blends.

Response: We added oil price relative to the cost of production of biofuels in Table II.E.1-1 and in 

the text preceding and following the table acknowledging this factor.

18. With respect to Pg 24, please confirm that USDA has provided EPA the values they plan to insert 

for the XXX’s in the following: 

“...Based on data provided by the USDA, we have estimated that U.S. agricultural land 

reached XXX million acres in 2014, and thus did not exceed the 2007 baseline 

acreage...” (the 2007 baseline acreage was given as 402 million acres on page 23). 

“...The total agricultural land in Canada in 2014 is estimated at XXX million acres. The 

total acreage estimate of XXX million acres does not exceed the trigger point for 

further investigation...” (should also add a footnote clarifying this “trigger point”) 

Response: EPA received the required information from USDA after the package was sent up for 

interagency review. The relevant sections have now been updated with these numbers (replacing 

xxx in all instances). We will add a reference to the Canadian baseline and ‘trigger point’ as well.

19. The commenter recently provided the EPA data on land use on Agricultural Cropland (FSA 

sourced), acres enrolled in the Conservation Reserve Program (CRP and FSA sourced), the 

Grassland Reserve Program (GRP), the Wetlands Reserve Program (WRP), and the Agriculture 

Conservation Easement Program for Wetlands Reserve Easements (ACEP-WRE) and 

Agriculture Land Easements (ACEP-ALE). The commenter would like to see the estimates of 

agriculture land based on the data provided for 2014 and 2015.

Further, the 2014 Farm Bill terminated the WRP and GRP as of 2013 and initiated the 

Agriculture Conservation Easement Program with “Wetlands Reserve” and “Agriculture Land” 

easements. As a consequence the ACEP-WRE and ACEP-ALE represent a continuation in basic 

objectives and goals of the original WRP and GRP and acreage enrolled in the easement 

programs would represent a good/fair proxy of WRP and GRP acreage. Text should reflect this 

modification in methodology.

Response: This section has been updated to reflect the agriculture land estimates provided by 

USDA. In addition we have included language to address the Farm Bill changes. Both agencies 

have agreed to work together to assess the impact of these data reporting changes, for the 2017 

Annual Rule.
20. (Pg 31) EPA writes that “...Constraints on the availability of biodiesel to U.S. consumers could 

include competing uses for feedstocks, international competition for biodiesel, the inconsistent 

nature of the biodiesel subsidy, limited investments to ensure quantity and quality of biodiesel 

product, limited infrastructure to distribute and blend biodiesel, and the limited ability of the 

market to consume biodiesel...” We assume that the biodiesel subsidy referenced here is the 

Federal excise tax credit for biodiesel blending. The D4, D5, and/or D6 RIN values can function 

in place of the blending tax credit, but only if the volume obligations are set to require high 

utilization of existing capacity.

Response: The subsidy referenced is the tax credit. We have edited the preamble to make this 

clear. We agree that higher RIN values can function in place of the tax credit, as the commenter 

suggested, but they do not fully address the other issues mentioned. It is for this reason that we 

have projected growth in biodiesel to be approximately equal to the growth seen in 2013, when 

standards were beyond the ability of the market to achieve with liquid biofuels even when the tax 

credit was in place.

21. (Pg45) The scenarios presented in Tables II.B-5-1 and II.B.5-2 do not consider the potential for 

additional renewable diesel to meet the statutory targets for total renewable fuel and advanced 

biofuel. Renewable diesel uses the same raw materials as biodiesel but does not have any coldweather operability issues and can be used at much higher blend levels (as much as 100%) in 

existing diesel engines than can use biodiesel. As of September 2015, there are 1.3 billion 

gallons of renewable diesel capacity worldwide. See 

http://www.eia.gov/workingpapers/pdf/flightpaths_biojetffuel.pdf, p. 15.

Response: All references to BBD include both biodiesel and renewable diesel. We will add text to 

clarify this point.

22. (Pg 130) EPA writes that “...Total domestic production of BBD was 1.45 billion gallons (2.19 

billion RINs), while imports resulted in an additional 0.34 billion gallons (0.55 billion RINs)...” The 

volume is EIA’s reported total Biomass-based Diesel imports for 2013. The resulting number of 

RINs is calculated incorrectly. 0.34 billion gallons of biodiesel * 1.5 RINs per gallon = 0.51 

billion RINs. Furthermore, EIA uses slightly different names for diesel fuel substitutes than

EPA; imports of Biomass-based Diesel consist only of FAME biodiesel. Diesel fuel from 

renewable sources other than FAME such as hydrotreated vegetable oil are reported by EIA as 

Other Renewable Diesel. To get at EPA’s definition of Biomass-based Diesel, EIA’s imports of 

Other Renewable Diesel needs to be considered as well. EIA reports that imports of renewable 

diesel, which generated both D4 and D6 RINs, were 207 million gallons in 2013.

Response: The numbers in the cited text were derived from EMTS, not EIA, and include both 

biodiesel (which has an Equivalence value of 1.5) and renewable diesel (which typically has an 

Equivalence value of 1.7). We use EMTS because this is the most accurate source of information 

available on renewable fuels that qualify under the RFS program.