RFA says there are several reasons for the concern: increases in blend rates for Brazilian fuels has put more pressure on Brazilian ethanol markets, limiting imports; U.S. sugarcane ethanol imports are slowing; European sugarcane demand is increasing; and lack of exportable ethanol surplus from the U.S. is limiting circular trade with Brazil.
National Corn Growers Association President Pam Johnson added that retaining the high requirement and relying on sugarcane ethanol could depress conventional biofuel demand and escalate Renewable Identification Number prices.
An ongoing point of contention, RFA says the "blend wall" – a cap on the amount of ethanol that can be blended into traditional fuels due to ethanol blending limits – should not be a reason to limit the volume requirements in the RFS.
The group says viable options exist for breaking through the E10 blend wall and meeting RFS requirements with physical volumes.
"E15 and E85 blends are legally approved and offer a workable pathway for meeting increased RFS volumetric requirements," the group wrote." The current U.S. light duty automotive fleet unquestionably has the capacity to consume the modestly higher volumes of ethanol above the blend wall that would be required for RFS compliance."
RFA says only modest investments would be required to modernize fuel distribution and accommodate higher ethanol blends.
EPA is expected to release the final rule in November.