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RFA disputes big oil’s no harm to ethanol claim

The Renewable Fuel Association’s Chief Economist says Small Refinery Waivers like the one granted to oil giant Chevron Tuesday continues to hurt the ethanol industry.  Scott Richman says, “Even though we’ve had some good news lately on the blend rate, the residual effects from the Small Refinery Exemptions has continued to cause ethanol prices to be lower than they otherwise would have been.”

Richman says the exemptions have led to too many Renewable Identification Numbers that are now worth far less.  “The EPA is estimating that at the end of this year, there will be just over three billion RINS in inventories that refiners will be able to carry over and use for future compliance, so, unfortunately, that’s a reason that this is going to be with us and going to adversely affect the market.”

Richman says a petroleum industry media blitz claims ethanol demand was unharmed by small refinery exemptions, but demand destruction has happened and is likely to continue.

Listen to Scott Richman speak with Brownfield’s Larry Lee