With Trump, Oil Refiners ‘Will Be Back in the Driver’s Seat’ on RFS, Says Analyst

The incoming Trump administration is likely to be unfriendly to biofuels if it repeats the record of the president-elect’s first term in office, said biofuels analyst Scott Irwin of the University of Illinois on Wednesday. There could be the liberal approval of waivers exempting small refiners from the Renewable Fuel Standard (RFS), he said, as well as efforts to whittle down the ethanol mandate.

“We should assume refiners will be back in the driver’s seat,” said Irwin during a farmdoc daily webinar. “It’s going to be a bumpy and turbulent ride figuring out how this is all going to net out for biofuels. So all I can say is, really, buckle up, and I lean toward unfriendly compared to friendly.”

Corn ethanol use fell to 12.5 billion gallons in 2020, during the first Trump administration. The EPA issued dozens of small refinery exemptions under Trump. Farm-state lawmakers repeatedly asked President Trump to intercede with the EPA over the treatment of renewable fuels.

This time, Trump has selected former Rep. Lee Zeldin of New York as his nominee for EPA administrator. During four terms in the House, Zeldin sponsored bills to eliminate the RFS and to block ethanol blends into gasoline exceeding 10%.

If Zeldin is confirmed by the Senate, one of his early tasks at the EPA will be setting the RFS for 2026–28. The Biden administration issued a three-year RFS “set” in 2022 but said earlier this summer that the EPA would not complete the next set until December 2025, a year later than required by law. The RFS for 2025 calls for using 15 billion gallons of corn ethanol and 7.4 billion gallons of cleaner-burning “advanced” biofuels, including biomass-based diesel.

The biofuel industry says ethanol, made from domestic grain, fits into Trump’s goal of energy independence.

Irwin, a University of Illinois professor, devoted most of his webinar to the near-term outlook for renewable diesel and biodiesel fuel. “Without policy incentives, there is no market” for the fuels, he said. The RFS is the most significant factor in determining demand, so the elements of the new RFS rule rank among three policy wild cards; the others are rules for the new 45Z clean-fuel tax credits and the impact of potential trade wars on imports of feedstocks for the fuels.

“I wish I could be more certain in outlook, but policy markets … are most uncertain when policy is highly uncertain,” he concluded.

To watch a video of the webinar, click here.