The 2026-2027 Renewable Fuel Standard (RFS) proposal from the EPA can only be met if the U.S. significantly increases imports of foreign biofuels and feedstocks.
In short, the RFS proposal is at odds with the White House’s energy dominance agenda.
There are three major issues with EPA’s advanced biofuel proposal, starting with the advanced biofuel mandate being too large. The EPA overshot its projections for the amount of domestic advanced biofuel and advanced biofuel feedstock will be available in 2026 and 2027.
The EPA relied on old data from 2023 and 2024, using none of the available 2025 data, to arrive at the 2026-2027 RFS proposal. The EPA assumed the same growth trends in domestic biofuel feedstock and production from earlier years would continue into 2026 and 2027. But things have changed, and data from this year show advanced biofuel production in the U.S. is declining.
The advanced biofuel mandate will require a significant uptick in imports. If advanced biofuel feedstock and production had kept pace with 2023 and 2024 growth trends, it might have been possible, in theory, to satisfy the full RFS advanced biofuel mandate with just American fuel and feedstocks.
But, as stated above, the EPA’s supply assumptions are incorrect. The only way to meet the oversized mandate is by increasing the amount of advanced biofuel feedstock imported into the U.S. The EPA wants to penalize advanced biofuel imports while simultaneously requiring more of them, creating a paradox for the industry.
For 2026 and 2027, the EPA wants to cut the RFS value of any imported biofuels and feedstocks in half, aiming to boost demand for domestic fuels and feedstocks. With the proposal itself being so big, it is going to require more feedstock imports.
Fixing the advanced biofuel portion of the RFS doesn’t have to be complicated. In fact, AFPM has given the EPA a head start. The EPA leaned on an S&P Global Commodity Insights analysis of 2023-2024 data to inform its proposal. AFPM commissioned the same team at S&P Global Commodity Insights to run the same analysis, just of the latest 2025 data. If the EPA simply swaps in the new analysis for its final 2026-2027 RFS, they’d trim down the advanced biofuel portion of the mandate to reflect actual domestic advanced biofuel and feedstock supplies.
The EPA should also scrap the plan to devalue imported fuels and feedstocks, especially when the mandate can’t be satisfied without them. Not every advanced biofuel production facility or refinery in the U.S. has equal or economic access to domestic soybean oil. In fact, it would add significant time and cost if coastal facilities far from the heartland of the U.S. were made to run solely on domestic feedstocks.
Refineries and biofuel manufacturing facilities often have long-term feedstock contracts, some of which already extend into the 2026 RFS compliance year. Feedstock origin has never been part of the RFS credit value calculus, and EPA cannot suddenly insert that into the program, particularly since major business decisions have been made in the years since the RFS was enacted based on an understanding of how the federal government viewed and valued biofuel feedstocks.
There are mile-wide loopholes in the import penalty plan. EPA’s proposal would punish U.S. fuel manufacturers who import crushed feedstocks into the U.S. to make biofuels here. It would, likewise, punish imports even if they were made from U.S. soy, but crushed elsewhere, before being imported back into the U.S. However, foreign soy that gets imported and crushed here would get full credit under EPA’s RFS proposal.
Just on the news of EPA’s proposal, RFS credit prices and soybean oil commodity prices jumped because the market recognizes there’s a scarcity of domestic feedstocks and fuel to fully satisfy EPA’s proposal. For an administration that prioritizes American energy dominance and affordability, this RFS proposal is not aligned to help the industry meet those aims.
For more information, visit afpm.org.
