According to Wayne Lee, CEO of Lee Enterprises Alternative Fuels Consulting, the current biodiesel market will hurt oil companies. The company, under its RIN 9000 program, is now providing free information about biodiesel companies to the oil industry. This initiative was launched to provide RIN obligated parties to help address what Lee says is “RIN purchase hesitation,” an emerging trend in the biodiesel industry.
“RFS2 mandates that these refiners and importers purchase renewable identification numbers to show compliance with RFS2,” Lee explains. “Last year the EPA uncovered two isolated instances of people apparently producing RINS without producing any biodiesel. But when the EPA started invalidating some of these RINs, it caused quite a problem for oil companies who then were understandably hesitant to purchase RINs.”
Legally speaking, obligated parties must buy RINs but RINs can only be created when biodiesel is produced. So, says Lee, if biodiesel producers can’t sell their RINs (aka can’t sell their biodiesel) and quit producing biodiesel, it will likely cause a significant price increase for those that do exist.
To address this problem, Alternative Fuels Consulting began administering a RIN procedure verification program for producers and obligated parties. The service includes onsite plant inspectons, third party verification of plant procedures, independent biodiesel testing, and education. From there, a list is compiled of producers who have completed their review and then provided to obligated parties for free.
Obligated parties can sign up to receive the report at the company’s website.