By RYAN TRACY
WASHINGTON -- The US
Environmental Protection Agency on Thursday held its ground on
the federal mandate for using renewable motor fuels, proposing
to boost a requirement for next-generation fuel even after it
lost a recent court case throwing out last year's
The agency said it intended to require US refiners and fuel
importers to use a total of 16.55 billion gallons of renewable
fuel during 2013, up 8.9% compared to 15.2 billion gallons last
As in previous years, the lion's share of that mandate is
expected to be met with ethanol made from Midwestern corn.
But the agency is also proposing to boost the requirement
for advanced renewable fuels, including diesel-motor fuel made
from soybeans, sugarcane ethanol imported from Brazil, and
"cellulosic" fuels made from inedible parts of plants, such as
corn stalks and wood chips.
The EPA requirement for advanced fuel would be about 2.75
billion gallons in 2013, compared to 2 billion gallons last
year. Of that requirement, 1.28 billion would have to come from
plant-based diesel-motor fuels, and 14 million gallons must be
The agency's proposal was a win for cellulosic fuel
producers, including KiOR, which has a plant in Mississippi
that the EPA expects will produce about 8 million gallons of
cellulosic fuel from wood chips.
Brooke Coleman, executive director of the Advanced Ethanol
Council, a group of cellulosic fuel producers, said the EPA got
"the right number" and provided "advanced biofuel investors and
innovators with a predictable and durable path forward."
The American Petroleum Institute, an oil industry trade
group, won a lawsuit earlier this month throwing out last
year's cellulosic fuel requirement. The EPA in 2012 required
refiners to buy 8 million gallons of cellulosic fuel, but the
industry only produced about 20,000 gallons that could count
toward the mandate.
The institute Thursday criticized EPA's proposal to require
even more cellulosic fuel this year. "The promised production
[of cellulosic fuel] hasn't happened," said Bob Greco, the
institute's downstream group director. "With today's
announcement, EPA has proven yet again that its renewable fuels
program is unworkable and must be scrapped."
Part of Thursday's decision was a negative for US corn
ethanol producers. They had asked the EPA to require fewer
gallons of "advanced" fuel in order to limit imports of
Brazilian sugarcane ethanol, which qualifies for the "advanced"
category and takes market share from ethanol made
The EPA proposal issued Thursday did not heed those requests
and could "open the door even wider to imports," said the
Renewable Fuels Association, a US ethanol trade group.
The EPA will take public comments for 45 days before moving
to finalize the 2013 renewable fuel requirement.
Separately Thursday, the EPA released a draft plan designed
to prevent fraud in the market for tradable credits that
companies use to prove they are meeting the renewable fuel
mandate. The agency has said in recent years that some
alternative diesel-motor fuel credits were fake, which has made
it harder for small, relatively unknown producers of
alternative diesel to do business.
The National Biodiesel Board, a trade group, said the EPA
fraud plan "appears to be another positive step" toward solving
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