Federal Renewable Fuels Standard Takes Effect

EERE Network News - 9/5/07

The federal Renewable Fuels Standard (RFS) went into effect on September 1st, setting new reporting, registration, and compliance requirements for major refiners, fuel blenders, and fuel importers. Authorized by the Energy Policy Act of 2005, the RFS requires that 4.2% of the fuel sold or dispensed to U.S. motorists in 2007 must come from renewable resources, an amount equal to about 4.7 billion gallons. That minimum volume will increase each year until it reaches 7.5 billion gallons of renewable fuel in 2012.

According to the Renewable Fuels Association, the ethanol industry should easily meet the requirements of the RFS. The industry currently has the capacity to produce nearly 6.8 billion gallons of ethanol per year, and expansions at existing biorefineries and new biorefineries under construction will add another 6.6 billion gallons of annual production capacity. Once those facilities begin operating, the industry will be able to produce 13.4 billion gallons of ethanol per year, far exceeding the RFS requirements. However, the RFS will guarantee a market in the event of a drop in demand for ethanol, and having the mechanism in place will make it easier to institute more ambitious RFS goals with future legislation.

The ethanol industry is also starting to implement new technologies to reduce the greenhouse gas impacts of ethanol production. E3 BioFuels opened an ethanol plant in late June that derives its energy from biogas generated from cattle manure and biomass. Located in Mead, Oklahoma, next to a feedlot with 28,000 cattle, the new facility consumes virtually no fossil fuel, according to the company. In mid-August, Blue Flint Ethanol celebrated the grand opening of its ethanol plant in Underwood, North Dakota, that uses excess steam from an adjacent coal power plant as its main energy source. The facility, which started operating in February, is capable of producing 50 million gallons of ethanol per year.