EPA delivered a proposed rule reallocating waived 2025 Renewable Fuel Standard (RFS) volumes to the White House Office of Management and Budget (OMB) for interagency review, Biomass Magazine reported. The transmission marks the procedural step required before EPA can publish revised percentage standards in the Federal Register.

The proposal targets volume obligations tied to small-refinery exemptions that EPA granted for prior compliance years and that have since been returned through court remand or administrative action. Under the RFS, the agency must still meet statutory annual volume targets for total renewable fuel, advanced biofuel, cellulosic biofuel and biomass-based diesel even after granting individual hardship exemptions. Reallocating waived volumes is the mechanism the agency uses to keep those statutory targets intact, typically by lifting the percentage standard applied to obligated parties for the affected compliance year.

What does the 2025 reallocation cover?

The rule is specific to the 2025 compliance year. Small-refinery exemptions granted in earlier years have been challenged in court, with several decisions remanding the waivers back to EPA. The agency has moved in successive rulemakings to redistribute those volumes, and the 2025 proposal is the next installment of that redistribution effort. Obligated parties — refiners and importers of gasoline and diesel — will absorb the adjusted percentage standard once the final rule issues.

Who is affected on each side?

Small refineries that received hardship relief and have since seen those decisions reversed form the exemption side of the ledger. The larger refining and importing community, which must now retire more renewable identification numbers (RINs) per gallon of fossil fuel placed in the domestic market, sits on the compliance side. Advanced and cellulosic biofuel producers are the downstream beneficiaries: higher implied volumes translate into firmer RIN demand and, in tighter market conditions, stronger prices for D4 biomass-based diesel, D5 advanced biofuel and D3 cellulosic RINs.

Why 2025 specifically?

The 2025 compliance year operates against percentage standards EPA set in its June 2022 Set rule and subsequent modifications. RIN values moved through a softer band earlier in 2025, partly because the market was pricing in expected redistribution. The proposed rule, once published, will reset that calculation against a Federal Register baseline rather than market expectation.

What's the procedural path?

After OMB clears the proposal under Executive Order 12866, EPA will publish it in the Federal Register for public comment. The comment period deadline, once set, governs the timeline for a final rule. For 2025 compliance, the rule must clear OMB and survive public comment before the close of the calendar year if obligated parties are to incorporate revised percentage standards into compliance reports filed the following February.

What to track next

The next binding milestone is OMB clearance. Once the proposed rule surfaces in the Federal Register, the comment deadline becomes the date industry must meet. A final rule follows, with the effective date determining whether 2025 obligations shift before or after compliance reports close.