Groups applaud EPA letter from 3 Midwest governors on need for higher biobased diesel volumes in RFS

Clean Fuels Alliance America, the Iowa Soybean Association, Iowa Biodiesel Board and the Missouri Soybean Association welcomed a letter sent by Govs. Kim Reynolds, R-Iowa, Mike Parson, R-Missouri, and Jim Pillen, R-Nebraska, to U.S. EPA Administrator Michael Regan, asking the agency to substantially increase the biomass-based diesel and advanced biofuels volumes in the Renewable Fuel Standard for 2023-’25.

The letter points out that EPA proposed biobased diesel volumes below 3 billion gallons through 2025, even though the U.S. industry produced more than 3 billion gallons in 2022.

EPA is expected to finalize the RFS volumes by June 14.

“Considerable investments by biodiesel and renewable diesel producers, oilseed processors and farmers in our states will be put at risk without a true upward trajectory for the RFS volumes,” the governors write.

“Limiting rural economic development and hindering opportunities for farmers in our states is the wrong approach,” the letter continues. “Adding to the supply of fuel, expanding agriculture markets and supporting rural economies is the right thing to do right now.”

“Domestic biodiesel, renewable diesel, and sustainable aviation fuel producers, soybean growers and processors, and many other allied industries are looking to EPA to deliver on the promise of an upward trajectory for RFS volumes,” said Kurt Kovarik, vice president of federal affairs with Clean Fuels. “Our members have made significant investments to grow the industry, and those investments are already paying off.”

“We thank Govs. Reynolds, Parson and Pillen for highlighting the imbalance between EPA’s promised trajectory for the RFS and its proposal,” Kovarik added. “In the first three months of 2023, the clean-fuels industry increased biodiesel and renewable diesel production enough to completely fill the meager space that EPA proposed for the next three years. EPA must significantly expand the RFS volumes to support the continued growth and availability of advanced biofuels.”

Grant Kimberley, executive director of IBB, said, “Gov. Reynolds continues to serve as an outspoken proponent for biodiesel, and we commend her for her leadership. We agree with the governor that rather than holding it back, now is the time to unleash the power of biomass-based diesel to address both new and old challenges that our country faces. Biodiesel can help reduce high fuel costs through a more diverse fuel supply, boost American manufacturing and shore up the vital farm economy—all while reducing carbon in the transportation sector. These are benefits the EPA can embrace by giving biodiesel more than a nominal increase under the RFS volumes.”

Randy Miller, ISA president and soybean farmer from Lacona, Iowa, added, “U.S. fuel prices remain persistently high, which impacts the economics of our country across the board. Farmers face increased expenses in planting, harvesting and other inputs, and high fuel costs impact the transportation of our food and other goods, which could exacerbate inflation for all Americans. Also on the line is $5 billion in investments—more than 10 percent of which is in Iowa—to increase soybean-crush capacity. This is badly needed infrastructure that would help shore up this country’s food and fuel supply. Now is the time to encourage rural economic development and opportunities for farmers while making our fuel supply substantially better. We thank Gov. Reynolds for her continued recognition of this and for her leadership in trying to make the case for a stronger course of action from EPA.”

Dave Walton, a member of Clean Fuels’ governing board and a farmer from Wilton, Iowa, stated, “A year ago, our industry cautiously celebrated what EPA called a ‘jumping off’ point that would put RFS volumes on an upward trajectory. But EPA’s proposal did not deliver on that promise—it wouldn’t provide any growth at all if you weigh it against the current pace of industry expansion. Biodiesel producers, oilseed processors and farmers face real-world consequences from low RFS volumes. There are 19 soybean-processing projects in the Midwest to expand or build new facilities. As drafted, EPA’s proposed rule could put these investments at risk.”

Missouri Soybean Association President Matt Wright, a soybean grower from Emden, Missouri, stated, “Planned growth of the biodiesel and renewable diesel industry promises substantial economic opportunities for farming communities. Biodiesel production adds nearly $500 million to the value of our state’s soybean crop and supports thousands of jobs. Expected growth has encouraged investment in additional soybean processing capacity that will keep more value of our soybean crop here in our local communities. As capacity and production grows, the economic benefits will increase—unless EPA fails to get the RFS volumes right.”

Greg Anderson, also a member of the Clean Fuels governing board and a farmer from Newman Grove, Nebraska, added, “Homegrown biodiesel and renewable diesel production meets every one of the goals for the Renewable Fuel Standard—cleaner air, energy security, rural economic growth and opportunity. And it is providing drivers a break on fuel prices at the pump by increasing the supply. EPA has no reason to set low goals for the advanced biofuel sector.”

The letter is available for download here.