EPA Sets Record Renewable Fuel Volumes for 2026-2027

Key Takeaways from the American Farm Bureau Federation:

• EPA sets record Renewable Volume Obligations (RVOs) for 2026–2027, with growth concentrated in biomass-based diesel and advanced fuels while conventional ethanol remains at 15 billion gallons. Nationwide year-round E15 would help support higher levels of ethanol demand.

• Small refinery exemption (SRE) reforms redistribute previously waived gallons into future obligations, preserving overall renewable fuel demand and reducing long-standing uncertainty in biofuel and agricultural markets.

• EPA did not finalize proposed import-related Renewable Identification Number (RIN) restrictions, signaling a more incremental policy approach that leaves room for future adjustments.

EPA’s final Renewable Fuel Standard rule establishing Renewable Volume Obligations (RVOs) for 2026 and 2027 sets higher overall renewable fuel volumes, with particular growth in advanced biofuels like biomass-based diesel and cellulosic fuels. Renewable fuels are produced from feedstocks such as corn, soybeans, used cooking oil and animal fats.

The proposed rule included provisions aimed at limiting the role of imported fuels and feedstocks in generating Renewable Identification Numbers (RINs), a change intended to better align the program with domestic production and support U.S.-grown commodities. However, the final rule did not adopt the import RIN reduction Instead EPA intends to establish import RIN reduction provisions that will take effect beginning in the 2028 compliance year or shortly thereafter. Additionally, the rule includes a partial waiver of the 2025 cellulosic biofuel requirement due to lower-than-expected production and finalizes changes to how small refinery exemptions are accounted for, redistributing previously exempted volumes into future obligations to maintain overall demand.

Overall, the final rule reinforces demand for American-grown feedstocks while providing more certainty for farmers, biofuel producers and fuel markets. This Market Intel outlines the final RFS volumes and examines their potential impact on agriculture.

Read more by going to the American Farm Bureau Federation website, https://www.fb.org/market-intel/epa-sets-record-renewable-fuel-volumes-for-2026-2027.