US ethanol, biomass-based diesel RIN prices near all-time highs – EIA

HOUSTON (ICIS)–Prices for US renewable identification number (RIN) credits have been rising steadily and are near all-time highs, largely because of reduced fuel production due to softer demand amid the coronavirus (Covid-19) pandemic, the US Energy Information Administration (EIA) said on Wednesday.

RINs function as credits which serve as the compliance mechanisms used for the Renewable Fuel Standard (RFS) program administered by the US Environmental Protection Agency (EPA).

The RFS program requires that nation’s transportation fuel supply include renewable fuels.

Renewable fuel producers generate RINs that refiners and importers of gasoline or diesel obtain and then ultimately retire for compliance.

Market participants can trade RINs, and this trading creates prices that the EIA tracks.

Amid falling transportation demand in spring 2020, wholesale gasoline prices fell by more than wholesale ethanol prices.

The corn ethanol RIN price reached more than $1/gal in late January and early February 2021, the highest price since 2013 when the corn ethanol RIN price reached an all-time high, the EIA said.

Similarly, the biomass-based diesel RIN price, applied to volumes of both biodiesel and renewable diesel fuels, approached $1.20/gal during the same period.

Prices have also been pressured upward because of fewer small refinery exceptions since 2018 and uncertainty around future RFS levels.

RFS renewable volume obligations for 2021 have yet to be released.

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