Update:
Agri-Pulse has learned the White House has cancelled Monday morning's meeting between biofuel and oil industry stakeholders.
According to a source, the administration cited "productive meetings" with the Department of Agriculture and the Environmental Protection Agency throughout the week, but said dialogue was "not ready to elevate" to the White House level just yet.
Original story:
The next meeting in the debate over the future of biofuels policy is set for Monday morning, sources tell Agri-Pulse.
The meeting will convene at 9 a.m. and include four company leaders: Poet CEO Jeff Broin and Green Plains CEO Todd Becker will be representing biofuels, Valero CEO Joe Gorder and Monroe Energy CEO Jeff Warmann will represent oil interests.
It is not clear at this time who will represent the administration at the meeting, but President Donald Trump is not expected to be in attendance. No members of Congress are scheduled to attend.
“I don’t think it matters who from the biofuels industry is in the meeting because there is so much unanimity with regard to a price cap on RINs or a waiver credit program,” Renewable Fuels Association President and CEO Bob Dinneen told Agri-Pulse. “I think the answer, no matter who they picked, is going to be the same: It’s not just no, it’s hell no.”
The meeting will be the second gathering in three weeks to bring oil and biofuel companies together at the White House. On March 1, a contingent of industry representatives met with Trump and a handful of Republican senators to discuss a potential resolution to what the oil industry sees as excessively high costs of Renewable Identification Numbers, or RINs. Those are the credits used to measure compliance with the Renewable Fuel Standard to ensure adequate levels of biofuels are being blended with the nation’s fuel supply.
At last week’s meeting, Trump suggested a two-year cap on the price of RINs coupled with regulatory relief to allow summer sale of E15 to increase the amount of available credits and expand the use of ethanol.
Since that meeting, a number of studies have been published exploring the idea of a RIN price cap and its potential impact on biofuels. An analysis from Clearview Energy Partners suggests that such a cap would have to be more than 42 cents per gallon, more than four times the 10-cent cap the oil industry is said to be seeking.
Biofuel industry sources tell Agri-Pulse that the idea of a RIN cap remains untenable, citing concerns about what such a policy would do if set at a low enough level to provide a disincentive to expand blending infrastructure.
Instead, the renewable fuels community has been thinking about a two-pronged idea to submit: issuing a waiver so E15 can be sold during the summer and create a RIN multiplier system that could incentivize higher blends. The multiplier would kick in on gallons of ethanol blended into gasoline at a rate of greater than 10 percent.
An ag economist, though, cautioned that such a multiplier “is impractical and would be a nightmare to administer,” adding that the “incentives for cheating would be immense.”
No matter the outcome of Monday’s meeting, Dinneen says he expects discussion surrounding the issue to continue.
“Either it is an ongoing dialogue at the White House or they come down and say ‘this is what we’re going to do.’ In either case, it’s not over,” Dinneen said, noting that further action will still be subject to public comment and input.
(Story updated to include additional reaction.)
