E15 and E85 Demand Under RIN Price Caps and an RVP Waiver

Abstract

•A leading Renewable Fuel Standard reform proposal considered by policymakers would allow E15 (fuel containing 15% ethanol) sales throughout the year and implement a cap on D6 RIN prices between $0.10 to$0.20/RIN. •While year-round sales of E15 would encourage retailers to sell the fuel, capping D6 RIN prices would reduce consumption of E15 and E85. •A cap on D6 RIN prices between $0.10/gal to$0.20/gal would likely reduce the effective ethanol mandate from 15 billion gallons to about 14.3 billion gallons in 2018. •Unless increased ethanol exports compensate for the reduced mandate, corn prices woulddecrease under the proposal’s D6 RIN price cap