NATSO Analysis: RIN Market Volatility Driven By Policy Announcements, Rumors & News Reports; Reforms Unnecessary

In the coming weeks, the Environmental Protection Agency (EPA) is expected to propose regulations that would reform the market for Renewable Identification Numbers (RINs), which are the “credits” EPA uses to ensure that refiners satisfy their obligations under the Renewable Fuel Standard (RFS). Although the supposed purpose of these reforms is to “improve transparency” and limit volatility in RIN markets, the reforms under consideration would cause more harm than good. In fact, as NATSO’s “RIN Market Volatility” Chart demonstrates, wild RIN price swings over the past several years have been caused by policy announcements, rumors, and news reports, rather than any underlying flaw in RIN markets themselves… 
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Freight Waves – How Truck Stops Could Drive The Electric Revolution, FreightWaves

Truck stops have incorporated a number of side businesses to keep up with the changing needs of customers – gaming, branded restaurants, and crude-oil hauling to name a few. 

But generating electricity hasn’t even been on the radar. 

Now, as the prospects for electric trucks shift from concept to reality, Neil Chatterjee believes electricity generation could be the next big thing. 

As Chairman of the Federal Energy Regulatory Commission – the top regulator of the nation’s power grid – Chatterjee said the need for a stable electricity infrastructure to support the trucking industry is analogous to a trend occurring among the world’s technology platforms. 

“If you look at the big energy users – Google (NASDAQ: GOOGL), Amazon.com, Inc. (NASDAQ: AMZN), Facebook, Inc. (NASDAQ: FB) – they’re moving beyond the traditional model where they’re just energy consumers, they’re actually impacting energy markets because their data centers consume so much power,” said Chatterjee, speaking with FreightWaves on February 12 after a NATSO board meeting at the fuel retailer group’s annual conference in Orlando… 
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GOVERNORS’ BIOFUELS COALITION – Groups Exploring Potential Midwest LCFS Collaborative

ORLANDO, Fla. — The Renewable Fuels Association (RFA) has been involved in preliminary conversations around the possibility of a collaborative effort of Midwest states seeking to establish a Low Carbon Fuel Standard (LCFS) program similar to the West Coast Collaborative, RFA President and CEO Geoff Cooper said Tuesday. 

In an interview with reporters at the National Ethanol Conference here, Cooper revealed that discussions have taken place but that they have been only exploratory so far. 

Cooper said that in the early days of California’s LCFS program, there was a strong “fear of the unknown” factor among ethanol producers regarding how their industry and ethanol demand in that state would be affected. 
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BIODIESEL MAGAZINE – Alternative Fuels Council Offers Biodiesel Strategy, Jeff Hove

The U.S. EPA’s Renewable Fuel Standard provides incentives for marketers to increase margins and be more competitive. Since its inception, the RFS has generally been a very successful program as blenders across the U.S. improved margins. If current legislative proposals move forward, marketers could witness another 13 years worth of similar incentives. But renewable identification number (RIN) value volatility—driven by political rumor, speculation and poor departmental management of small refinery exemptions—as well as a continually lapsing IRS blender’s tax credit make for difficult times for down-stream blenders. At times, the economic risk appears to be too high, and blending must stop and wait for better days. 

The variables that make blending economics questionable at times, however, are the same variables that can give blenders hope that market conditions will get better. The downstream transportation fuel industry is no stranger to risk, as fuel pricing ebbs and flows daily. Biofuel producers typically don’t understand that blenders and marketers live in a world where they are selling at a loss one day and hoping for gains the next. This willingness to take on risk is what keeps the biodiesel industry moving forward during periods of policy uncertainty… View Full Article

NATSO Alternative Fuels Council Unveils RFS RIN Management Service

NATSO Inc., the national association representing the travel plaza and truckstop industry, and the Alternative Fuels Council (NATSOAltFuels.com), today launched a new RIN Management Service designed to help fuel retailers that blend and sell renewable fuels to more efficiently participate in the Renewable Fuel Standard (RFS) program and manage their Renewable Identification Numbers (RINs). 

The Alternative Fuels Council’s RIN Management Service will help those who buy, sell and blend biodiesel, ethanol, renewable diesel, and renewable CNG to manage the complex compliance requirements under the RFS. Under the RIN Management program, participants will: (1) consult with experts on the RFS and Low Carbon Fuel Standard compliance; (2) get help registering for EPA’s RFS program as well as for the IRS Blenders License; (3) access sources for fuel supply options; (4) secure advice and assistance for state incentive programs; and (5) monitor the status of impending IRS Blender’s Tax Credits. … Read More

NATSO Comments to EPA on Renewable Fuel Standard

NATSO submitted formal comments to the Environmental Protection Agency on August 17, outlining the off-highway fuel retailer community’s concerns with how the Renewable Fuel Standard (RFS) has been implemented in recent months, while providing the agency several ideas for how the RFS can be improved. The comments are in response to the agency’s proposed renewable fuel mandates for 2019. Those numbers will not be finalized until November. 

“The RFS, when implemented properly, has proven to be an effective, market-based program that diversifies, enhances, and improves the emissions characteristics of the nation’s fuel supply while lowering costs for consumers. The program’s success has hinged on NATSO members’ ability to acquire, blend, and sell biodiesel on a cost effective basis relative to traditional diesel fuel,” NATSO wrote… Read More

NATSO Testifies EPA Needs Transparent Process to Assess Small Refinery Waivers

The Environmental Protection Agency (EPA) needs a transparent process to guide its assessment of small refinery waiver requests to ensure that such exemptions don’t continue to undermine the law’s intent and decrease demand for biofuels, a travel center executive testifying on behalf of NATSO told the agency July 18. 

Testifying at an EPA field hearing in Ypsilanti, Michigan, on the 2019 proposed renewable volume obligations (RVOs) under the RFS, Beth Westemeyer, Director of Business Development for Anew Travel and Fuel Centers, the retail arm of Zeeland Farm Services in Zeeland, Mich., said that over the past decade the RFS has succeeded because it allows fuel retailers to offer biofuel blends to consumers at a price that is less expensive than purely petroleum-based products… Read More

NATSO Analysis: EPA’s Proposed Biofuel Mandates a Mixed Bag for Travel Center Operators

The Environmental Protection Agency on June 26 released its proposed renewable volume obligations for 2019 under the Renewable Fuel Standard (RFS). The proposal also includes a proposed 2020 volume mandate for biomass-based diesel. The proposal would increase advanced biofuels volume requirements for 2019 and biodiesel requirements for 2020 while holding the so-called “ethanol” volume requirement steady. 

These increases are positive for NATSO members. However, the proposal also indicates that EPA will continue to liberally waive obligations for small refineries, which in essence means that the actual volume increases are less than the numbers indicate (as the waivers function as mandate cuts). These waivers undercut the purpose of the RFS and inject uncertainty and volatility into markets that can hinder NATSO members’ operations…. Read More

NATSO Testifies Before Congress on Biodiesel Policy

“My travel center has been incorporating biodiesel into our fuel supply for more than ten years. Once the RFS and similar state incentives became law, it was clear to me that I had to invest in biodiesel in order to remain competitive.” 

“Congress recognized in designing the RFS that the only way to get truck drivers to buy more advanced biofuels is to make those fuels less expensive than straight diesel fuel.” 

“The EPA’s policy of liberally granting small refinery hardship exemptions is undercutting demand for advanced biofuels. When these waivers are issued retroactively, as they have been in recent months, they function as de facto mandate cuts in the RVOs, dramatically lowering RIN prices and in turn, demand for advanced biofuels.” 
Full Written Testimony

NATSO Launches Alternative Fuels Council

NATSO Inc. on June 12 launched a new business venture known as the Alternative Fuels Council (NATSOAltFuels.com) to help fuel retailers leverage the resources necessary to learn about and incorporate alternative fuels into their supply offerings. 

The Alternative Fuels Council will work with members of the truckstop and travel plaza community and other fuel retailers to navigate the litany of state and federal fuel regulations, and to utilize available government incentives for alternative fuels, including the Renewable Fuel Standard (RFS). The Alternative Fuels Council will also help its partners implement profitable strategies related to alternative fuel supply options and fuel infrastructure… Read More