In a New Twist, RFS Could Boost Electric Vehicles

EPA announces a rule expanding what fuel sources qualify for the RFS.

July 09, 2014

WASHINGTON – The federal policy used to build up the nation's ethanol and advanced biofuel capacity could soon be harnessed to spur the development of electric vehicle infrastructure, according to a final rule issued by the EPA last week. According to an article in Greenwire, the EPA said that it would allow renewable electricity made from certain biomass sources to qualify under the Renewable Fuel Standard (RFS) if it is used to power electric vehicles. Under the rule, entities would be allowed to generate credits for that electricity and make money selling them to refiners that must meet annual renewable fuel targets.

Clean vehicle advocates are hoping it will provide new incentives to utilities to invest in the electric vehicle sector and bring in new constituencies to support the RFS. Historically, the RFS put into place in 2007 has been used to boost the ethanol and advanced biofuels sectors in the name of lowering greenhouse gas emissions and reducing foreign oil dependence.

But the standard applies broadly to biomass-derived transportation fuel, and EPA has determined that renewable electricity made out of biogas from landfills, municipal wastewater treatment and solid waste digesters, and agricultural digesters meets the 60% greenhouse gas reduction threshold to qualify as a cellulosic biofuel.

The change will "facilitate the introduction of new renewable fuels under the RFS program," EPA said in its announcement. "By qualifying these new fuel pathways, this rule provides opportunities to increase the volume of advanced, low-GHG renewable fuel — such as cellulosic biofuels — under the RFS program."

Previously, EPA had allowed biogas to qualify for RFS credit if it was used as a gas, rather than being converted to electricity. EPA first proposed the expansion last year as part of a rule qualifying other types of new renewable fuel. The new rule would apply under specific conditions for both commercial and private electricity distribution systems, provided the generated electricity is used as a transportation fuel. Interest groups representing electric vehicles and some utilities had advocated for the change, as well as for EPA to expand its original proposal to include on-farm digesters that convert manure to biogas.

Advocates of electric vehicles would like to see a greater role for utilities, but incentives for electric vehicles have thus far been geared more toward consumers than building up infrastructure. States are just starting to grapple with regulatory issues involving utilities and electric vehicle infrastructure.

Expanding the RFS to those types of renewable energy would require congressional action because of RFS language limiting incentives to biomass-based renewables. Opening up the RFS, though, is a tough political sell at the moment for supporters of the policy because doing so would potentially allow opponents to take stabs at it through amendments.

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