Biogas market awaits RFS guidance; plus RNG news from WM, Viridi, Vision

Yahoo

06-05-2025

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This is the latest installment in Waste Dive's Biogas Monthly series.
EPA Administrator Lee Zeldin has set out a busy regulatory (or deregulatory) agenda over the first 100 days of President Donald Trump's term, but one regulation he's left untouched is the Renewable Fuel Standard. The regulation sets a certain amount of non-petroleum fuel credits that refiners and importers of petroleum-based fuels must acquire in a given year, which plays an important role in creating demand for the fuels.
The U.S. EPA initially set those levels, known as Renewable Volume Obligations, annually, but it chose to set the targets for three years in 2023. With those targets set to expire at the end of this year, many fuel producers are wondering how aggressive the Trump administration will be for the next round of RVOs.
The EPA is already overdue to set those targets, and the market for renewable fuels is slumping amid the uncertainty. That's in part because the Biden EPA floated the possibility of a waiver for obligated parties that didn't hit their targets last year, said Adam Schubert, a senior associate at Stillwater Associates. That proposal is now in the hands of the Trump administration.
The waiver would apply to 2024 targets, and it's looking like the market may need another waiver again this year as production lags behind demand. But no one in the fuels industry quite knows what to expect, according to Schubert.
'For producers, they don't know what the volume is. For buyers, it gives them an incentive not to buy. That creates a bad incentive,' he said. 'The market's still trying to figure out 2024 and 2025 while waiting for 2026 to come out.'
Prices for RINs, the credits generated by alternative fuel producers, have been trading lower since late last year, hurting the incentive.
Schubert said there are also structural aspects of the transportation fuel credit market that will be hard for the EPA to solve. Namely, many of the fleets that can run on compressed natural gas and buy RNG already do. In order for there to be more demand for these fuels, more CNG-powered fleets would need to come online. But those fleets have typically come about through state-level incentives like in California, and most regulators today are looking to facilitate a transition toward electric rather than CNG.
There are several paths forward: New CNG-powered engines are entering the market with longer range that might entice more fleet owners to switch. More states could allow for a switch to CNG-powered vehicles amid attacks on clean trucks mandates. Or, the EPA could take another look at eRINs, the controversial proposal that would create a credit for renewable electricity used to power vehicles.