EPA May Open Renewable Fuel Credits to EV Industry

Automakers, charging providers and related companies could access a new type of credit called e-RINs.

October 07, 2022

ALEXANDRIA, Va.—Electric vehicles could be eligible for renewable fuel credits under an upcoming proposal on biofuel blending mandates from the U.S. Environmental Protection Agency, reports Reuters.

Under the federal Renewable Fuel Standard (RFS), oil refiners are required to blend biofuel into the nation’s fuel supply or buy tradable credits, which are known as RINs, from those that do.

If the electric vehicle industry were to be included into the federal RFS, EV manufacturers, such as Tesla, could benefit and be able to access a new type of credit called e-RINs, or electric RINS. Other industries related to the EV industry could be included in the subsidy, such as car-charging companies and landfills that supply renewable biogas to power plants.

Reuters reports that Tesla has been in talks with the Biden Administration on the e-RIN program. EVs would likely qualify for e-RINs under the program's "D3" mandate pool, which includes cellulosic biofuels that can be made from wood waste and other feedstocks.

The inclusion of EVs into the RFS would be one of the largest changes to program since it began more than a decade ago. The proposal is expected to reach the White House for approval by the end of next week and is expected to detail annual biofuel blending mandates for multiple years instead of just one.

The switch to a multiyear target would be aimed at providing longer-term certainty to the refining and biofuels industries, according to Reuters. The EPA has until November 16 to propose the 2023 mandates.

In June, the EPA announced biofuel blending mandates for 2022 and the prior two years. The 2022 biofuel blending mandate for 2022 is 20.63 billion gallons, and the EPA retroactively set the volume mandates for 2021 at 18.84 billion gallons and for 2020 at 17.13 billion gallons.

The EPA also denied oil refiners waivers to be exempt from the requirements but said it would allow extra time for small refiners to meet their 2020 blending obligations.

NACS filed comments with the EPA on its annual RFS obligations. NACS reiterated that the biofuels obligations must be set so that they can reasonably be absorbed and consumed by the market and avoid hitting the “blend wall.”