LCFS Biodiesel & Renewable Diesel Consumption Diverge from Estimates

LCFS Biodiesel & Renewable Diesel Consumption Diverge from Estimates

The California Air Resources Board (CARB) is expected to deliver third quarter consumption data for the LCFS program at the end of the month.  The Jacobsen expects to a decline in biodiesel usage from the second quarter based on EPA Moderated Transaction System (EMTS) data. California consumed 57.4 million gallons of biodiesel in the second quarter of 2019.  The Jacobsen expects third quarter consumption to fall into the 52 to 55-million-gallon range, which is below CARB’s forecast for 68.7 million gallons.

The Jacobsen also expects renewable diesel usage to be lower, although there is a possibility that it could rise slightly from the 160 million gallons consumed in the second quarter of 2019. EMTS data suggests that renewable diesel consumption in California will be between 151 and 166 million gallons during the third quarter of 2019, which is above CARB’s 137.5-million-gallon estimate and The Jacobsen’s 151-million-gallon forecast.

CARB had projected biodiesel consumption for the year to reach 275 million gallons.  The Jacobsen had initially projected 230 million gallons of consumption.  Currently, both forecasts appear to be high given the lower than expected consumption over the first half of the year. The Jacobsen expects 2019 biodiesel production to be 198 to 205 million gallons. This is up from 2019 production but below program projections.

Renewable diesel was expected to reach 550 million gallons for 2019 by CARB and 607 million by The Jacobsen.   Renewable diesel has been outpacing expectations and is expected to surpass both sets of estimates. The Jacobsen expects year-end 2019 renewable diesel production to reach 657 to 690 million gallons.

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