The U.S. government will require energy companies to use a record amount of biofuel next year, a victory for Midwest farmers that supply ethanol makers over oil firms that say using more biofuels in gasoline and diesel is costly and unachievable.
The Renewable Fuel Standard (RFS) program, signed into law by President George W. Bush in 2005, was designed to curb greenhouse gas emissions, promote energy independence and boost rural economies by raising demand for biofuels.
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The Environmental Protection Agency (EPA) in a statement on Wednesday set the target for total renewable fuel use at 19.28 billion gallons for 2017, higher than the 18.8 billion gallons it had initially proposed in May. The EPA bumped up the volumes after the U.S. government revised its 2017 gasoline demand forecast upwards.
The total requirement marked a six per cent rise from this yea and was larger than some in the industry had expected.
The EPA is required to set annual targets for how much ethanol and biodiesel needs to be blended with gasoline and diesel.
Hitting target set out in 2007 law
The requirements include 15 billion gallons for conventional biofuel, which is mainly corn-based ethanol. That marked the first time the EPA has hit a target laid out by Congress in 2007.
EPA set the mandate for advanced biofuels, a variety of fuels considered more environmentally friendly than ethanol, at 4.28 billion gallons.
Wednesday's plan marked the final renewable fuels mandate to be set under the Obama administration, which biofuels advocates previously said had fallen short of targets to promote their fuels.
Biofuels produce less greenhouse gases than petroleum-based fuels and result in cleaner air.
Pushback from petroleum industry
Currently, gasoline sold in the U.S. has an average of 10 per cent ethanol. The petroleum industry had opposed an increase in the mandate to use more biofuels, arguing conventional vehicles are not meant to burn more ethanol and might have maintenance problems.
In Canada, Canada's Renewable Fuels Regulations require an average renewable fuel content of five per cent in gasoline, though most fuels have more ethanol.
Renewable Industries Canada, which promotes the use of renewable fuels, has called for an increase in the mandated amount of ethanol blended into Canadian gasoline to 10 per cent.
