Brent D. Yacobucci
Specialist in Energy and Environmental Policy
Analyst in Agricultural Conservation and Natural Resources Policy
The Energy Independence and Security Act of 2007 (EISA; P.L. 110-140), significantly expanded the renewable fuel standard (RFS) established in the Energy Policy Act of 2005 (EPAct 2005; P.L. 109-58). The RFS requires the use of 9.0 billion gallons of renewable fuel in 2008, increasing to 36 billion gallons in 2022. Further, EISA requires an increasing amount of the mandate be met with "advanced biofuels"—biofuels produced from feedstocks other than corn starch and with 50% lower lifecycle greenhouse gas emissions than petroleum fuels. Within the advanced biofuel mandate, there are specific carve-outs for cellulosic biofuels and biomass-based diesel substitutes (e.g., biodiesel).
To classify biofuels under the RFS, the Environmental Protection Agency (EPA) must calculate the lifecycle emissions of each fuel relative to gasoline or diesel fuel. Lifecycle emissions include emissions from all stages of fuel production and use ("well-to-wheels"), as well as both direct and indirect changes in land use from farming crops to produce biofuels. Debate is ongoing on how each factor in the biofuels lifecycle should be addressed, and the issues surrounding direct and indirect land use are particularly controversial. How EPA resolves those issues will affect the role each fuel plays in the RFS.
EPA issued a Notice of Proposed Rulemaking on May 26, 2009, for the RFS with suggested methodology for the lifecycle emissions analysis. EPA is expected to promulgate regulations on biofuels lifecycle emissions in the next few months, although this rulemaking is already overdue under EISA. As EPA's decisions will affect the marketability of each combination of fuel type, feedstock, and production process, there is growing congressional interest in the topic. Congressional action could take the form of oversight of EPA's rulemaking process, or could result in legislation to amend the EISA RFS provisions. Further, related legislative and regulatory efforts on climate change policy and/or a low-carbon fuel standard would likely lead to interactions between those policies and the lifecycle determinations under the RFS.
On January 12, 2009, the state of California finalized regulations for a state low carbon fuel standard (LCFS). The LCFS requires increasing reductions in the average lifecycle emissions of most transportation fuels. The rule does not require total emissions to decrease, but the emissions intensity (emissions per unit of energy delivered) must be 10% below that of gasoline and diesel fuel by 2020. California concluded that some biofuels lead to higher emissions (i.e., lower emission reductions) than what EPA has proposed. In other cases, the California estimates are more favorable to biofuels. This difference highlights the ongoing debate over lifecycle analysis methods.
Date of Report: January 29, 2010
Number of Pages: 17
Order Number: R40460
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Friday, February 5, 2010
Brent D. Yacobucci