Biomass-Based Diesel Consumption Forecast Declines but Ethanol Increases for 2021 & 2022

The Energy Information Administration (EIA) January Short Term Energy Outlook (STEO) has the volume of renewables used in diesel blending moving lower for 2021 and 2022. The Environmental Protection Agency (EPA) uses EIA data when issuing its proposed and final rules for blending requirements.

The EPA’s Proposed Volume Standards for 2021 and 2022 show the volume of renewables in diesel forecast at 2.23 billion gallons for 2021 and 2.66 billion in 2022. The proposed rule was published December 21, 2021. The latest STEO has reduced the forecasts for 2021 to 2.08 billion gallons, a 145-million-gallon reduction.  The 2022 forecast was reduced to 2.66 billion gallons, a 207-million-gallon reduction.

The reductions stand out as the amount of diesel expected to be used within the transportation pool has increased since the Proposed Rule was…