EIA: RFS Boosts Biofuel Consumption
OAKHURST, N.J. (DTN) -- The Energy Information Administration expects ethanol production this year to average 936,000 barrels per day (bpd), according to the most recent Short-term Energy Outlook published Tuesday, June 9, unchanged from last month's estimate and 1,000 bpd higher than output in 2014.
"On May 29, the U.S. Environmental Protection Agency proposed a rule setting Renewable Fuel Standard targets for 2014 through 2016. Although these targets could be modified before the final rule is issued, they are used in developing the current STEO," EIA said.
The agency forecast 2016 production at 933,000 bpd, down 4,000 bpd from the May STEO projection.
Ethanol consumption, which averaged 878,000 bpd in 2014, is forecast to average 891,000 bpd this year and 895,000 bpd in 2016, resulting in an average 9.9% ethanol share of the total gasoline pool this year and next.
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EIA said it "does not expect measurable increases in E15 or E85 consumption over the forecast period. The proposed RFS targets are expected to encourage imports of Brazilian sugarcane ethanol, which were just 3,000 bpd in 2014."
The agency said that because of the increase in ethanol gross imports, net exports of ethanol are expected to fall from 51,000 bpd in 2014 to 44,000 bpd this year and 36,000 bpd next year.
EIA said it expects the biggest effect of the proposed RFS targets to be on biomass-based diesel consumption, which contributes to meeting the biomass-based diesel, advanced biofuel and total renewable fuel RFS targets.
Biodiesel production averaged an estimated 81,000 bpd in 2014 and is forecast to average 90,000 bpd in 2015, which is 9,000 bpd higher than the prior month. In 2016, biodiesel production is forecast to average 98,000 bpd versus month prior projections at 84,000 bpd.
Net imports of biomass-based diesel are expected to increase from 16,000 bpd in 2014 to 26,000 bpd this year and 35,000 bpd in 2016, which are 9,000 bpd and 19,000 bpd higher than in last month's STEO, respectively.
"EIA expects that a combination of higher biomass-based diesel consumption, higher consumption of domestic and import ethanol, and banked Renewable Identification Numbers will help meet the newly proposed RFS targets through 2016."
The agency estimates that carbon dioxide emissions grew 1.0% in 2014 and are projected to decrease by 0.4% this year and then rise by 0.2% in 2016. These forecasts are sensitive to both weather and economic assumptions.
(BM/AG)
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