{ "id": "R41106", "type": "CRS Report", "typeId": "REPORTS", "number": "R41106", "active": false, "source": "EveryCRSReport.com, University of North Texas Libraries Government Documents Department", "versions": [ { "source": "EveryCRSReport.com", "id": 444872, "date": "2015-08-31", "retrieved": "2016-04-06T22:43:56.956350", "title": "The Renewable Fuel Standard (RFS): Cellulosic Biofuels", "summary": "Congressional Research Service\n7-5700\nwww.crs.gov\nR41106\nSummary\nThe Renewable Fuel Standard (RFS) was established under the Energy Policy Act of 2005 (EPAct05, P.L. 109-58), and was later expanded under the Energy Independence and Security Act of 2007 (EISA; P.L. 110-140), in accordance with efforts at that time to reduce dependence on foreign oil, promote biofuel use, and stabilize transportation fuel prices, among other goals. Over 15 years, the RFS requires that increasing amounts of biofuels\u201436 billion gallons by 2022\u2014be used in transportation fuel. The mandate is to be accomplished in part with advanced biofuels, including cellulosic biofuels\u2014fuels produced from cellulosic materials, including grasses, trees, and agricultural and municipal wastes\u2014which would increase over time to comprise some 44% of the RFS in 2022. \nThe U.S. Environmental Protection Agency (EPA) is required to set the annual standard (i.e., usage requirement) for cellulosic biofuels under the RFS if the projected volume of cellulosic biofuel production is less than the volume specified in the statute (i.e., the mandate). Under this circumstance, EPA can lower the annual cellulosic biofuels standard to the volume expected to be available for that year. If EPA lowers the standard for a given year, it is required to do so by November 30 of the preceding year, and it must issue cellulosic biofuel waiver credits that obligated parties may purchase for that compliance year in lieu of actual fuel requirements. EPA concluded that the nation lacked sufficient production capacity to meet the RFS cellulosic biofuels mandate each year from 2010 to 2016. In 2010, EPA reduced the mandate from the statutory volume of 100 million gallons to 6.5 million (ethanol-equivalent) gallons, in 2011 from 250 million gallons to 6.0 million gallons, in 2012 from 500 million gallons to 10.45 million gallons, and in 2013 from 1 billion gallons to 810,185 gallons. In May 2015, EPA announced its proposal to lower the 2014 mandate from 1.75 billion gallons to 33 million gallons, the 2015 standard from 3 billion gallons to 106 million gallons, and the 2016 standard from 4.25 billion gallons to 206 million gallons and to rescind the 2011 cellulosic biofuel standard. EPA intends to finalize the RFS volume requirements for 2014, 2015, and 2016 by November 30, 2015. This delay in issuing the annual standards\u2014EPA is currently one year and eight months past the statutory deadline for 2014 and eight months past the deadline for 2015\u2014raises significant uncertainty for biofuel producers, feedstock growers, and refiners. \nThe 2010-2012 reduced cellulosic biofuel mandates were not met by actual cellulosic biofuel production, which EPA reports was limited. Instead, these mandates were largely met with waiver credits. Official compliance data for 2013 and 2014 is unavailable at this time as the compliance deadline for these years has not been finalized. \nActual cellulosic biofuel production has fallen significantly short of the RFS mandates. However, in 2014, the industry opened three commercial-scale cellulosic ethanol plants in Iowa and Kansas with a combined production capacity of up to 52 million gallons per year. In addition, a large portion of cellulosic biofuel production for 2014 and 2015 is being met with two newly approved cellulosic biofuel pathways\u2014renewable compressed natural gas and renewable liquefied natural gas. There was also the November 2014 bankruptcy filing by the company KiOR, which had commenced operations of the first commercial-scale cellulosic fuel facility in 2012 in Mississippi. While these milestones are significant for a nascent cellulosic biofuel industry, given the many challenges the industry has faced on multiple fronts, and given past performance, it may be likely that the cellulosic biofuel volumes set in statute will not be met in the near term.\nEvaluating the viability of the cellulosic biofuel component of the RFS is difficult. Many factors have impacted and may continue to impact what can be accomplished. Factors to consider include the uncertainty stemming from EPA\u2019s implementation of the RFS, Congress\u2019s action on biofuel programs and tax incentives, industry\u2019s difficulty in producing cellulosic biofuel, and the unknown impact of current oil and gasoline prices.\nContents\nIntroduction\t1\nThe EISA RFS Cellulosic Biofuel Standard\t2\nWaiver Authority\t3\nRFS Compliance\t3\nEPA Annual Cellulosic Biofuel Projections, 2010-2016\t5\nEPA Reported Cellulosic Biofuel Compliance\t6\n2010-2012\t6\n2013-2014\t8\nLegislative Context\t8\nThe Role of Congress\t9\nThe Role of EPA\t11\nLegal Challenges\t12\nUncertainty\t13\nBackground on Cellulosic Biofuels\t14\nPotential Benefits of Cellulosic Biofuels\t15\nEnergy Security\t15\nEnvironment\t15\nRural Economic Development\t16\nPotential Challenges for Cellulosic Biofuels\t16\nFinancing\t16\nFeedstock Eligibility\t17\nFeedstock Supply\t17\nExisting Plant Capacity\t18\nFinancial Assistance\t19\nConclusion\t20\n\nTables\nTable 1. RFS Biofuels Mandate in EPAct05 and EISA: Total Renewable Fuels and Cellulosic Biofuels\t4\nTable 2. Selected Legislation from the 114th, 113th and 112thCongresses Pertaining to Cellulosic Biofuels\t9\n\nContacts\nAuthor Contact Information\t21\n\nIntroduction\nThe Renewable Fuel Standard (RFS), created by the Energy Policy Act of 2005 (EPAct05, P.L. 109-58) and expanded under the Energy Independence and Security Act of 2007 (EISA, P.L. 110-140), mandates that domestic transportation fuel contain specified volumes of biofuels\u2014including conventional biofuels (e.g., cornstarch ethanol) and advanced biofuels (e.g., cellulosic biofuel, biomass-based diesel). Given the economic and policy environments at the time the RFS was enacted, there was discussion that the RFS could help to reduce dependence on foreign oil, promote biofuel use, and stabilize transportation fuel prices, among other goals. The revised RFS under EISA requires that increasing amounts of biofuels be included in transportation fuel, with volume requirements identified in statute over a 15-year period. These requirements start with 9 billion gallons of total renewable fuel in 2008 and build up to 36 billion gallons annually by 2022. The mandate is to be accomplished in large part with increasing volumes of cellulosic biofuels, with 16 billion gallons required by 2022. Thus far, the yearly cellulosic biofuels volume requirements identified in the statute have not been met.\nThe RFS contains annual volume standards (i.e., usage requirements) for each of its biofuel categories, including for cellulosic biofuels. Recognizing that the cellulosic biofuel industry was in its infancy at the time of the RFS\u2019s passage, Congress gave the U.S. Environmental Protection Agency (EPA) waiver authority to adjust the annual cellulosic biofuel standard under certain conditions. For instance, if the projected volume of cellulosic biofuel production is less than the volume specified in the statute (i.e., the mandate) for a given year, EPA is required to lower the cellulosic biofuel standard by November 30 of the preceding year and to issue cellulosic biofuel waiver credits to be used in lieu of actual cellulosic fuel for obligated parties to purchase for that compliance year. Due to a lack of U.S. cellulosic biofuel production capacity, the EPA, in successive years from 2010 to 2013, issued final rules under its waiver authority that lowered the cellulosic biofuel standard. EPA also proposes to lower the 2014, 2015, and 2016 cellulosic biofuel standards. \nIn the years since the inception of the cellulosic biofuels mandate for the RFS, there have continued to be questions about whether cellulosic biofuels can be produced in sufficient quantities to satisfy the RFS mandate in the near term and in future years. Progress toward meeting the cellulosic biofuels mandate has been delayed due to several issues; specifically, feedstock supply, financial viability and financing, and technology advancement are considered among the most significant limiting factors for cellulosic biofuel production. Given that the EPA has lowered the RFS cellulosic biofuel standard for four consecutive years and proposes to do so again for 2014, 2015, and 2016, and for various other reasons, some contend that Congress should repeal the RFS. Others want to reconsider its configuration, determine whether additional resources are necessary for cellulosic biofuel production, and/or assess the success of this effort compared to other renewable energy efforts. Still others assert that the current structure provides adequate incentives and measures to address any cellulosic biofuel production shortfalls.\nThe EISA RFS Cellulosic Biofuel Standard\nThe expanded RFS established in Section 202 of EISA requires that a certain volume of cellulosic biofuels be included in the national transportation fuel supply. The required volume increases incrementally each year. The RFS calls for 100 million gallons of cellulosic biofuels in 2010, 3 billion gallons in 2015, 10.5 billion gallons in 2020, and 16 billion gallons by 2022 (see Table 1). Cellulosic biofuels would comprise some 44% of the mandate if 16 billion gallons of cellulosic biofuels were actually produced in 2022. \nCellulosic Biofuel Requirement Differences Between the RFS1 and the RFS2\nCellulosic biofuel requirements under the expanded RFS established by EISA, sometimes referred to as RFS2, are more substantial than the requirements under the original RFS (or RFS1) established by \u00a71501 of EPAct05. There are three points in particular where differences exist between the expanded RFS and the original RFS: cellulosic biofuel type, cellulosic biofuel volume, and the production time frame. First, the original RFS had a narrower definition of what constituted a cellulosic biofuel, limiting the mandate to only cellulosic biomass ethanol. The original RFS did have a broader definition as to what counted as cellulosic material. The expanded RFS has a broader definition for cellulosic biofuels, accepting a variety of biofuel types from cellulosic material. Second, under the expanded RFS, the cellulosic biofuel volumes required are much larger. Third, the time frame to produce the biofuels is expedited under EISA. The original RFS was much smaller in scope, requiring 4.0 billion gallons of total renewable fuel for 2006, ascending to 7.5 billion gallons by 2012. Further, the original RFS would have required that 250 million gallons of the renewable fuel be derived from cellulosic biomass starting in 2013, whereas the expanded RFS required 250 million gallons of cellulosic biofuel in 2011.\n\nLimited analyses exist that provide information on how the EISA RFS annual cellulosic biofuel volume requirements were determined. Data and analysis presented during the RFS debate and ultimate passage of EISA in 2007 supported the idea that the required levels of cellulosic biofuel production capacity could be achieved. Some argued that plentiful feedstock would be available and that the conversion technology was close to being proven as commercially viable. Moreover, some presumed that the federal government would provide substantial financial support and enhance the infrastructure needed to spur a commercial cellulosic biofuels market. Others were leery about the time frame provided to meet the RFS cellulosic biofuels mandate, given the as-yet-undeveloped production capacity. \nWaiver Authority\nCongress gave the EPA administrator waiver authority to adjust the renewable fuel volume amounts identified in statute under certain circumstances. More specifically, Congress provided EPA with three waivers it may use to adjust the volume requirements\u2014a general waiver, a cellulosic biofuel waiver, and a biomass-based diesel waiver. The cellulosic biofuel waiver may be used by the administrator to reduce the cellulosic biofuel mandate when the projected volume amount for a given year is less than what is identified in statute. Should EPA decide to lower the cellulosic biofuel mandate in a given year, it is required to set the volume by November 30 of the preceding year and must issue waiver credits for obligated parties to purchase for that compliance year. Additionally, EPA may use the general waiver authority to waive the RFS, or any specific category of the RFS, if there is evidence that full implementation may cause severe economic or environmental harm. \nRFS Compliance\nEPA monitors RFS compliance by fuel blenders and other obligated parties according to their reported accumulation of renewable identification numbers (RINs) for each biofuel\u2019s yearly volumetric standard. A RIN is a unique 38-character number that is issued (in accordance with EPA guidelines) by the biofuel producer or importer at the point of biofuel production or the port of importation. Each qualifying gallon of renewable fuel has its own unique RIN. The EPA uses its Moderated Transaction System (EMTS) to manage RIN transactions. Using data generated from the EMTS, EPA provides aggregated monthly data on RIN generation and renewable fuel volume production for specific fuel categories, such as cellulosic biofuel. In general, compliance is achieved by an obligated party when the number of RINs submitted to EPA each year for cellulosic biofuels equates to the volume requirement for that year. Previous-year RINs may be used to meet current-year compliance, although there are some stipulations.\nAs noted above, EPA has the authority to waive the cellulosic biofuel mandate on a yearly basis. In any year that EPA grants a waiver, the agency must also make per-gallon waiver credits available at a set price, the formula for which is set in statute. Waiver credits may be used by obligated parties to comply with the cellulosic biofuel volume obligation in lieu of RINs generated with the production of the cellulosic biofuel. The 2010, 2011, 2012, and 2013 prices for cellulosic biofuel waiver credits were $1.56, $1.13, $0.78, and $0.42, respectively. The 2014 and 2015 cellulosic biofuel waiver credit prices are $0.49 and $0.64, respectively. If waiver credits are issued (when the mandate is reduced), compliance is to be met when the combination of waiver credits and RINs equates to the volume requirement for that year. \nTable 1. RFS Biofuels Mandate in EPAct05 and EISA: Total Renewable Fuels and Cellulosic Biofuels \n(in billions of gallons)\nYear\nEPAct05\nEISA\n\n\n\nTotal renewable fuels\nCellulosic biofuels\n\n\nTotal renewable fuels\nCellulosic biomass ethanol\n\nStatute\nEPA revised\n(ethanol-equivalent volume)\n\n2006\n4.0\n\u2014\n\u2013\u2013\n\u2013\u2013\n\u2013\u2013\n\n2007\n4.7\n\u2014\n\u2013\u2013\n\u2013\u2013\n\u2013\u2013\n\n2008\n5.4\n\u2014\n9.00\n0.00\n\u2013\u2013\n\n2009\n6.1\n\u2014\n11.10\n0.00\n\u2013\u2013\n\n2010\n6.8\n\u2014\n12.95\n0.100\n0.0065a \n\n2011\n7.4\n\u2014\n13.95\n0.250\n0.0060b \n\n2012\n7.5\n\u2014\n15.20\n0.500\n0.0105c \n\n2013\n\n0.250\n16.55\n1.00\n0.0008d \n\n2014\n\n\n18.15 (15.93 EPA revised)e\n1.75\n0.033e\n\n2015\n\n\n20.5 (16.3 EPA revised)e\n3.00\n0.106e\n\n2020\n \n\n30.0\n10.5\n\u2014\n\n2022\n\n\n36.0\n16.0\n\u2014\n\nSources: EPAct05 (P.L. 109-58) Section 1501, and EISA (P.L. 110-140), Section 202. \nNotes: Ethanol-equivalent volume is the volume used for RFS compliance purposes, which takes into account the energy content of the fuel. = according to EPAct05 statute, the total renewable fuel amount for 2013 and thereafter shall be determined by the EPA administrator. = according to EPAct05 statute, a minimum of 250 million gallons of cellulosic biomass ethanol is required for 2013 and thereafter.\nU.S. Environmental Protection Agency (EPA), \u201cRegulation of Fuels and Fuel Additives: Changes to Renewable Fuel Standard Program; Final Rule,\u201d 75 Federal Register, March 26, 2010. \nEPA, \u201cRegulation of Fuels and Fuel Additives: 2011 Renewable Fuel Standards; Final Rule,\u201d Federal Register, December 9, 2010. \nVacated under API vs. EPA. Level originally set by EPA at 0.00865 billion gallons. EPA, \u201cRegulation of Fuels and Fuel Additives: 2012 Renewable Fuel Standards; Final Rule,\u201d Federal Register, January 9, 2012. \nEPA, \u201cRegulation of Fuels and Fuel Additives: 2013 Renewable Fuel Standards; Final Rule,\u201d 79 Federal Register, May 2, 2014. \nEPA, \u201cRenewable Fuel Standard Program: Standards for 2014, 2015, and 2016 and Biomass-Based Diesel Volume for 2017; Proposed Rule,\u201d 80 Federal Register 33099, June 10, 2015.\nEPA Annual Cellulosic Biofuel Projections, 2010-2016\nEPA generally conducts its cellulosic biofuels volume projection analysis based on an evaluation of individual producers\u2019 production plans and progress to date, discussions with cellulosic biofuel producers, the Energy Information Administration (EIA), the Department of Agriculture (USDA), and the Department of Energy (DOE), and an assessment of the probabilities associated with production schedules from each of the producers. EPA\u2019s analyses concluded that the United States did not have sufficient cellulosic biofuel production capacity to meet the scheduled RFS mandates for 2010 to 2016. Therefore, for 2010 EPA reduced the mandate from the statutory volume of 100 million gallons to 6.5 million ethanol-equivalent gallons; for 2011 from 250 million gallons to 6.0 million ethanol-equivalent gallons; for 2012 from 500 million gallons to 10.45 million ethanol-equivalent gallons; and for 2013 from 1 billion gallons to 810,185 ethanol-equivalent gallons. \nThe rulemaking process to determine the 2014, 2015, and 2016 RFS annual standards is still in progress. The delay in issuing the 2014 and 2015 standards raises significant uncertainty for biofuel producers, feedstock growers, and obligated parties. EPA proposes to lower the 2014 cellulosic biofuel mandate from 1.75 billion gallons to 33 million ethanol-equivalent gallons, the 2015 standard from 3 billion gallons to 106 million ethanol-equivalent gallons, and the 2016 standard from 4.25 billion gallons to 206 million ethanol-equivalent gallons. According to EPA,\nThe 2014 proposed volumes reflect what was actually produced (i.e., EMTS 2014 RIN data). \nThe 2015 proposed volume reflects what was actually produced for those months where data are available and estimates for what might be produced in those months where data are not available. \nFor the 2016 projection, EPA proposes to use a similar methodology to the 2015 methodology for estimating what might be produced. \nThere are approximately eight facilities\u2014all with various start dates and production ranges over the next two years\u2014along with the renewable compressed natural gas and renewable liquefied natural gas industry that may produce commercial-scale volumes of cellulosic biofuel by 2016. EPA does not believe that cellulosic biofuel will be imported into the United States, except from one facility in Canada. \nAs of May 29, 2015, EPA had not received any projections of cellulosic biofuel production for 2015 or 2016 from the Energy Information Administration (EIA), but the agency anticipates that EIA will provide such projections for the final rule. EPA will take these projections into consideration.\nIn response to legal challenges of its cellulosic biofuel projection methodology for a specific year, EPA has in certain years revised the annual cellulosic biofuel standard to zero or proposed to voluntarily rescind an annual cellulosic biofuel standard. This has occurred when the standard as originally reduced by EPA has not been met. For instance, EPA\u2019s 2012 standard was vacated by a court decision. As a follow-up to the same court decision, EPA proposes to rescind the 2011 cellulosic biofuel standard. \nEPA Reported Cellulosic Biofuel Compliance\n2010-2012\nIn a straightforward scenario, cellulosic biofuel compliance with the RFS requires actual cellulosic biofuel production, waiver credits, or a combination of both. However, the situation becomes complicated when cellulosic biofuels are not produced on schedule. Despite the RFS mandate for cellulosic biofuels starting in 2010, the first registered production of cellulosic biofuels in the United States was not achieved until 2012.\nRFS cellulosic biofuel compliance can be separated into two phases: pre-EISA and post-EISA. There were different stipulations about how compliance was met prior to EISA (under RFS1) and after EISA (under RFS2). The transition from RFS1 (EPAct05) to RFS2 (EISA) occurred in 2010. RFS1 had different production requirements than RFS2 for cellulosic biofuels, including an ethanol-equivalency ratio of 2.5-to-1, where each gallon of cellulosic ethanol counted as 2.5 gallons toward the EPAct05 mandate. The EPA reports that zero cellulosic biofuel RINs were produced in 2010 under the RFS2 rules. The EPA reports that the majority of compliance for 2010 was met with RINs generated (i.e., production) under RFS1. EMTS records show that 12,186 cellulosic biofuel waiver credits were purchased in 2010, which likely made up for the remainder of 2010 compliance. \nCompliance data following the RFS1-to-RFS2 transition year of 2010 is more straightforward than other years. EPA reports that zero cellulosic biofuel RINS were produced in 2011. Compliance for 2011 was met with excess cellulosic biofuel RINs generated in 2010 under RFS1 and cellulosic biofuel waiver credits. EMTS records report that 4,248,388 RFS2 cellulosic biofuel waiver credits were purchased in 2011. EPA reports that there is no \u201cneed to address compliance with the 2012 cellulosic biofuel standard\u201d since there was a federal court decision that vacated the 2012 standard. EMTS reports that 20,069 RINS were generated for cellulosic ethanol and 1,741 RINS were generated for cellulosic diesel in 2012. \n2013-2014\nEvaluation of RFS compliance for a given calendar year is best determined once a rulemaking is complete that announces the annual standards (the statutory deadline for the rulemaking is November 30 of the preceding year) and once obligated parties have submitted the required information by the compliance deadline (typically March 31 of the following year). EPA completed the rulemaking process for the RFS annual standard for 2010-2013. However, the rulemaking process for 2014-2016 is ongoing. Compliance deadlines for 2010 through 2012 were met. Although it is eight months past the end of calendar year 2014, EPA has not yet finalized the compliance deadline for 2013 or 2014. EPA reports that \u201cit is important for obligated parties preparing a compliance demonstration report for a given calendar year to have an understanding of their RFS obligations for the next compliance year.\u201d Thus, due partly to the lack of a final rulemaking for the 2014 RFS annual standards, EPA proposes that the 2013 compliance deadline be January 31, 2016, and that the 2014 compliance deadline be June 1, 2016. These proposed compliance deadlines follow EPA\u2019s anticipated deadline of November 30, 2015, for issuing the 2014, 2015, and 2016 RFS annual standards. \nEMTS data for 2013 and 2014 cellulosic biofuel production and RIN generation are available. EMTS reports that 422,740 RINs were generated for cellulosic renewable gasoline blendstock and 395,777 RINS were generated for cellulosic diesel for the 2013 standard. EMTS reports that 728,509 RINs were generated for cellulosic ethanol; 8,859 RINs for cellulosic diesel; 44,168 RINs for cellulosic renewable gasoline blendstock; 15,208,068 RINs for renewable compressed natural gas; 17,379,815 RINS for renewable liquefied natural gas; and 50,446 RINs for cellulosic heating oil. The majority of the 2014 cellulosic biofuel mandate is being met with new fuel pathways approved by EPA in July 2014. This trend appears to continue for the first seven months of 2015, where EMTS records show 49,429,794 cellulosic biofuel RINs (mostly renewable compressed natural gas and renewable liquefied natural gas) and 173,731 RINs for cellulosic diesel were generated as of July 29, 2015.\nLegislative Context\nThe shift toward large-scale, economically feasible production of cellulosic biofuels has thus far proven elusive. Advancements have been made, but not in step with the pace set by Congress for the RFS. Multiple factors have contributed to the cellulosic biofuels market being at the stage it is today, with the two major factors being technological issues and a recession that slowed the economy, including energy demand. Due to production shortfalls, EPA has significantly reduced the cellulosic biofuels mandate each year from 2010 through 2013 and proposes to do so again for 2014, 2015, and 2016. Based on actual cellulosic biofuel production volumes for the 2010 to 2014 time frame, in crafting the legislation, Congress overestimated how much cellulosic biofuel production would occur on an annual basis. Further, although Congress provided EPA with waiver authority to align the cellulosic biofuel standard closer to actual production, projecting the production amount continues to be a challenge for both EPA and the EIA. If mandate reductions and continual production shortfalls signify that the cellulosic biofuels mandate is not working as intended, Congress could decide that modifications are necessary. \nThe Role of Congress \nCongress continues to have the authority to maintain or amend the RFS statutory mandates. Should the RFS be continued in its present form, amended, or eliminated completely? What additional public costs would each of these options engender? When expanding the RFS in EISA, Congress in effect made a technology choice by selecting a preferred technology (i.e., cellulosic biofuel) among many unknown technologies. Undoing that commitment by modifying or repealing the RFS could involve substantial costs to both public and private investors. The discussion about whether the cellulosic biofuels industry requires additional federal support to meet the RFS mandate has continued since the establishment of RFS1; however, the discussion became more pronounced when the RFS was expanded in 2007 to call for a much larger volume of cellulosic biofuel to be produced in a shorter timeframe. In response, Members of the 112th, 113th, and 114th Congresses proposed a variety of bills that would have affected the cellulosic biofuels industry (see Table 2). \nTable 2. Selected Legislation from the 114th, 113th and 112th Congresses Pertaining to Cellulosic Biofuels\nCongress\nLegislation\n\n114th \nS. 934 would require the cellulosic biofuel standard to be based on actual production and would modify the definition of cellulosic biofuel to exclude compressed natural gas, liquefied natural gas, or electricity used from biogas.\nH.R. 3228 would require EPA to limit the volume of cellulosic biofuel to be blended into the nation\u2019s fuel supply to what is commercially available.\n113th H.R. 550 and S. 251 would have modified the way EPA projects yearly cellulosic biofuel mandates.\nH.R. 796 would have required a reduction in the advanced biofuel mandate if the cellulosic mandate is lowered in any given year.\nH.R. 1461 would have repealed the RFS.\nH.R. 1462 would have eliminated the non-advanced biofuel portion of the RFS and modified the way EPA projects yearly cellulosic biofuel mandates. \n112th H.R. 230 would have modified the DOE Loan Guarantee Program, appropriating funds for EPAct05 Section 1512 Conversion Assistance for Cellulosic Biomass Waste-Derived Ethanol Approved Renewable Fuels, establishing a loan guarantee program for cellulosic ethanol production technology development.\nH.R. 424 would have amended the RFS to revert back to RFS1 targets and eliminated all advanced biofuel mandates.\nH.R. 851, H.R. 2231, H.R. 884, H.R. 1294 would have implemented new financial support mechanisms, extending relevant tax provisions.\nH.R. 6047 would have modified the way EPA projects yearly cellulosic biofuel volume mandates.\nSource: CRS. \nNotes: Legislation is presented in order of introduction for a given Congress. None of these bills became law.\nCongress could decide to modify the cellulosic biofuels mandate, and thus the RFS. This option could require an analysis of the cellulosic biofuels market and, perhaps more importantly, consideration of circumstances that were not as prevalent when the RFS was expanded in 2007. Some of these circumstances include budget concerns, the blend wall, military interest in renewable fuels, the slow development of the cellulosic biofuels production sector, and relatively low gasoline prices. Such an analysis might quantify the amount of federal support already granted to the cellulosic biofuels industry. One analysis of federal and public funding data for advanced biofuel projects provided by Environmental Entrepreneurs\u2014an organization of business leaders\u2014suggested that, since 2007, USDA, DOE, and the Department of Defense (DOD) have provided $928.4 million in grants and loan guarantees to eight companies that Environmental Entrepreneurs expects to bring commercial cellulosic biofuel facilities online by 2017. \nAlternatively, Congress could take a wait-and-see approach to address concerns with the cellulosic biofuels mandate. Given EPA\u2019s consecutive lowering of the mandate by approximately 95% to 99% for 2010 to 2013 and a proposal to do so for 2014, 2015, and 2016, some questions exists as to whether the cellulosic biofuels industry can ramp up production in the coming years to meet the scheduled RFS mandates. There may be an upcoming shift where some corn ethanol facilities plan to transition to cellulosic biofuel production, and it is not known what effect this might have on cellulosic biofuel production estimates. Further, it is not yet known what impact the additional feedstocks and production pathways (e.g., renewable compressed natural gas) approved by EPA may have on meeting the RFS cellulosic biofuel mandate, although for 2014 and thus far in 2015 the new renewable natural gas fuel pathways are responsible for the majority of cellulosic biofuel RIN generation. Last, Congress may leave it to EPA, as required by the statute, to modify the applicable volumes of the RFS in its entirety starting in 2016 if certain conditions are met. \nIt is possible that a substantial portion of the cellulosic biofuels volume mandate may be unattainable for years to come. EIA reports that while \u201ccellulosic biofuels volumes are expected to grow significantly relative to current levels, they will likely remain well below the targets envisioned in the Energy Independence and Security Act of 2007.\u201d Congress has multiple options to address the lack of cellulosic biofuels production if it chooses to do so. Congress could make a statutory change to the definition of cellulosic biofuels for the RFS to open it up to additional feedstocks that can assist with meeting the annual production targets. Or Congress may continue to require that the EPA set the cellulosic biofuels mandate based on the best available evidence\u2014the status quo option. In the 114th Congress, some Members have proposed legislation (e.g., S. 934, H.R. 3328) that would require EPA to base the cellulosic mandate on actual production or what is currently available. Congress could also eliminate the cellulosic biofuels portion of the mandate or the RFS entirely. \nThe Role of EPA\nCongress directed EPA to implement the RFS. One of EPA\u2019s roles in implementing the RFS is to reduce the annual standard for cellulosic biofuels if\u2014after assessing the cellulosic biofuels market, consulting with EIA, and taking other measures\u2014the volume amount identified in statute cannot be met. This new reduced standard for a given calendar year is to be determined through the rulemaking process. \nEPA\u2019s administration of the cellulosic biofuel feature of the RFS has its proponents and opponents. At times the support and opposition for the cellulosic biofuel feature are mingled with support and opposition for the overall RFS. Some Members of Congress and stakeholders are dissatisfied with EPA\u2019s implementation of the RFS and with the challenges to comply with the mandate, among other things. Some contend that EPA has not carried out its responsibilities regarding the RFS as expeditiously as desired. Some are not satisfied with the accuracy of EPA\u2019s annual cellulosic biofuel standard. Some Members of Congress support a strong RFS that will \u201cprovide the certainty needed to unlock future investments in renewable fuels and necessary infrastructure, reduce our nation\u2019s dependence on foreign sources of energy, and drive innovation and progress toward cellulosic, biodiesel, recycled-waste, algal, and other advanced biofuels.\u201d Some contend that EPA should raise the cellulosic biofuel requirements for 2015 and 2016 to amounts greater than what is in the proposed rule, among other things, to \u201chelp drive the growth of the advanced and ce", "type": "CRS Report", "typeId": "REPORTS", "active": false, "formats": [ { "format": "HTML", "encoding": "utf-8", "url": "http://www.crs.gov/Reports/R41106", "sha1": "e96325874c73f47947c51ba917f0acfb8973a5f8", "filename": "files/20150831_R41106_e96325874c73f47947c51ba917f0acfb8973a5f8.html", "images": null }, { "format": "PDF", "encoding": null, "url": "http://www.crs.gov/Reports/pdf/R41106", "sha1": "339932a4eedeb80f39a324d220c403a36e24cc72", "filename": "files/20150831_R41106_339932a4eedeb80f39a324d220c403a36e24cc72.pdf", "images": null } ], "topics": [] }, { "source": "University of North Texas Libraries Government Documents Department", "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc810174/", "id": "R41106_2015Jan14", "date": "2015-01-14", "retrieved": "2016-03-19T13:57:26", "title": "The Renewable Fuel Standard (RFS): Cellulosic Biofuels", "summary": null, "type": "CRS Report", "typeId": "REPORT", "active": false, "formats": [ { "format": "PDF", "filename": "files/20150114_R41106_689018cb07d44d67d6f4fbd9aa9a9290cf56ed23.pdf" }, { "format": "HTML", "filename": "files/20150114_R41106_689018cb07d44d67d6f4fbd9aa9a9290cf56ed23.html" } ], "topics": [] }, { "source": "University of North Texas Libraries Government Documents Department", "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc463313/", "id": "R41106_2013Mar11", "date": "2013-03-11", "retrieved": "2014-12-05T09:57:41", "title": "Meeting the Renewable Fuel Standard (RFS) Mandate for Cellulosic Biofuels: Questions and Answers", "summary": "This report, in a question and answer format, discusses some challenges facing the cellulosic biofuels community, including feedstock supply estimates, and potential legislative options to address cellulosic biofuels production uncertainty for the Renewable Fuel Standard.", "type": "CRS Report", "typeId": "REPORT", "active": false, "formats": [ { "format": "PDF", "filename": "files/20130311_R41106_4cb42507bd1a23a82ffd493dd7f80510f3cc1d34.pdf" }, { "format": "HTML", "filename": "files/20130311_R41106_4cb42507bd1a23a82ffd493dd7f80510f3cc1d34.html" } ], "topics": [ { "source": "LIV", "id": "Energy source development", "name": "Energy source development" }, { "source": "LIV", "id": "Energy research", "name": "Energy research" }, { "source": "LIV", "id": "Fuel research", "name": "Fuel research" }, { "source": "LIV", "id": "Biofuels", "name": "Biofuels" } ] }, { "source": "University of North Texas Libraries Government Documents Department", "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc83938/", "id": "R41106_2012Jan11", "date": "2012-01-11", "retrieved": "2012-04-27T15:49:45", "title": "Meeting the Renewable Fuel Standard (RFS) Mandate for Cellulosic Biofuels: Questions and Answers", "summary": "The Renewable Fuel Standard (RFS) was expanded under the Energy Independence and Security Act of 2007 (EISA; P.L. 110-140) in an effort to reduce dependence on foreign oil, promote biofuel use, and stabilize transportation fuel prices, among other goals. Over a 15-year period, the RFS seeks to establish a market for biofuels in the transportation sector by requiring that increasing amounts of biofuels-36 billion gallons by 2022-be blended into transportation fuel. The mandate is to be accomplished with an assortment of advanced biofuels, including cellulosic biofuels-fuels produced from cellulosic materials including grasses, trees, and agricultural and municipal wastes-which will ramp up over time to comprise some 44% of the RFS in 2022.", "type": "CRS Report", "typeId": "REPORT", "active": false, "formats": [ { "format": "PDF", "filename": "files/20120111_R41106_417da2c03efc654bef9fd87337747efef64dadfb.pdf" }, { "format": "HTML", "filename": "files/20120111_R41106_417da2c03efc654bef9fd87337747efef64dadfb.html" } ], "topics": [ { "source": "LIV", "id": "Energy source development", "name": "Energy source development" }, { "source": "LIV", "id": "Energy research", "name": "Energy research" }, { "source": "LIV", "id": "Fuel research", "name": "Fuel research" }, { "source": "LIV", "id": "Biofuels", "name": "Biofuels" } ] }, { "source": "University of North Texas Libraries Government Documents Department", "sourceLink": "https://digital.library.unt.edu/ark:/67531/metadc96675/", "id": "R41106_2011Jul13", "date": "2011-07-13", "retrieved": "2012-08-07T13:52:45", "title": "Meeting the Renewable Fuel Standard (RFS) Mandate for Cellulosic Biofuels: Questions and Answers", "summary": "This report discusses the background of the Renewable Fuel Standard (RFS) and answers some common questions about it. 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