Sample Outlooks

U.S. Federal

Renewable Fuel Standard

California

Low Carbon Fuel Standard

Oregon

Clean Fuels Program (coming soon)

British Columbia

Low Carbon Fuel Standard (coming soon)

RFS Outlook

 ABBREVIATED SAMPLE FROM 2023.
Do not act on this incomplete and outdated outlook.

Executive Summary

ABBREVIATED SAMPLE FROM 2023 

This dashboard presents Stillwater’s quantitative assessment of Renewable Identification Number (RIN) pricing under the U.S. Renewable Fuel Standard (RFS) through 2035. Our outlook includes annual average credit prices for each of the five RIN types – D3, D4, D5, D6, and D7.  

While Congress set Renewable Fuel Standard (RFS) targets through 2022, the RFS did not end at the close of 2022. For 2023 and beyond, EPA is required to annually establish new renewable volume obligation (RVO) targets in the absence of specified statutory targets. 

The supply and demand of renewable fuels and feedstocks in the U.S. have direct effects on the price of RINs. As such, we thoroughly examine and analyze the supply and demand trends for each of the major fuels used to comply with the RFS. These outlooks inform our RINs price outlook but are not included in this outlook dashboard subscription. For deeper insights into fuel supply and demand trends, contact us. 

RINs Overview

In this space, we offer an overview of Renewable Identification Numbers (RINs) – the credits (i.e., the currency) of the RFS.

For an overview of the RFS program, read our “RFS 101” primer. 

The RFS requires certain volumes of renewable fuel to be supplied to the U.S. transportation fuel market each year. Parties supplying the market with petroleum gasoline and diesel (generally, refiners and importers) are required to generate or acquire RINs proportional to the volume of gasoline and diesel supplied such that, in aggregate, the annual targets for renewable fuels, as spelled out in the regulations, are met.

RINs are generated when renewable fuels are supplied to the market via domestic production or imports. Producers of renewable fuels intending to satisfy the requirements of the RFS are subject to EPA regulations concerning approval of production pathways, facility and fuel registration, reporting, and validation.

The RFS statute defines four categories of renewable fuels:

    1. Total renewable fuel (RF) – All renewable fuels produced from approved feedstocks that achieve a minimum 20% reduction in lifecycle greenhouse gas (GHG) emissions, as determined by EPA’s model, when compared to the petroleum-derived fuels that they replace.
    2. Advanced biofuel (AB) – A subset of total renewable fuels (listed above) that achieve a minimum 50% reduction in lifecycle GHG emissions, as determined by EPA’s model, compared to the petroleum-derived fuels they replace. Ethanol produced from corn starch is specifically excluded from this category. Sugarcane-based ethanol, ethanol produced from grains other than corn (e.g., wheat, milo), and sources of renewable natural gas (RNG) that do not qualify as a cellulosic biofuel fall into this category.
    3. Biomass-based diesel (BBD) – A subset of advanced biofuels (listed above) that can be used to replace diesel fuel, jet fuel, or home heating oil. This category is comprised primarily of biodiesel (BD) and renewable diesel (RD) with the currently small volume of sustainable aviation fuel (SAF) production.
    4. Cellulosic biofuel (CB) – A subset of advanced biofuels (listed above) that are produced from lignocellulosic feedstocks and which achieve a minimum 60% reduction in lifecycle GHG emissions, as determined by EPA’s model, when compared to the petroleum-derived fuels which they replace. Cellulosic ethanol and RNG produced from feedstocks defined in the regulation – including biogas from landfills – qualify in this category.

Due to the nested structure of these four biofuel categories under the RFS regulations, there are five RIN types, commonly referred to by their “D Code”:

  • D3 RINs – cellulosic biofuels
  • D4 RINs – biomass-based diesel
  • D5 RINs – advanced biofuels which are not cellulosic and not biomass-based diesel
  • D6 RINs – renewable fuels that are not advanced biofuels (primarily corn ethanol), sometimes referred to as conventional biofuels
  • D7 RINs – cellulosic diesel

The figure below visually represents the relationships between the four renewable fuel categories and the five RIN types

RINS PRICES (REDACTED SAMPLE)

RINs Price Table ($/RIN)

Sources: EPA, Stillwater Analysis
Last Updated: Month Year

RINs Prices ($/RIN)

Sources: EPA, Stillwater Analysis
Last Updated: Month Year
RINs Outlooks
D4 (Advanced Biofuels: BBD) RINs

ABBREVIATED SAMPLE FROM 2023.

The price of D4 RINs, primarily used to satisfy an obligated party’s BBD obligation, fundamentally reflects the difference in the marginal cost of production of biodiesel (BD) and petroleum diesel. (i.e., the value of the D4 RIN compensates the blender for the additional cost incurred by sourcing BD instead of petroleum diesel to supply their customers) This calculation also reflects the value of the $1.00 per gallon federal biomass-based diesel blenders tax credit (BTC) through 2024 and the Clean Fuel Production Tax Credit (CFPC) beginning 2025. As soybean oil, a by-product of crushing soybeans to produce soybean meal (a high-protein animal feed) is the marginal feedstock for production of BD, the price spread between soybean oil and diesel fuel (often referred to in the market as the heating oil-bean oil, or HOBO spread) is the major driver of D4 RIN price.

D5 (Advanced Biofuels) RINs

ABBREVIATED SAMPLE FROM 2023

D5 RINs can be used to satisfy the portion of an obligated party’s AB obligation which is not satisfied by their compliance with their BBD (D4 and D7 RINs) and CB (D3 and D7 RINs) obligations. Fuels which commonly generate D5 RINs include sugarcane ethanol, RD produced via co-processing with petroleum diesel, RNG which does not qualify for D3 RINs, renewable naphtha, renewable LPG, and starch ethanol produced from crops other than corn (e.g., wheat, barley, and grain sorghum (milo)).

D3 (Cellulosic Biofuel) RINs

ABBREVIATED SAMPLE FROM 2023

The value of D3 RINs has historically been based on a combination of the value of CWCs and the value of D5 RINs.

D6 (Renewable Fuel) RINs

ABBREVIATED SAMPLE FROM 2023

D6 RINs are available to meet an obligated party’s obligation for Total Renewable Fuels in excess of the Advanced Biofuels obligation. They represent conventional biofuels (i.e., biofuels which are not Advanced Biofuels). This category, often referred to as Conventional Biofuels, is predominantly comprised of corn starch ethanol. D6 RINs are the highest volume and most highly traded RIN type. As such, they tend to be the most sensitive to market news that potentially impacts the supply/demand balance for these RINs. This volatility often results in news coverage which can focus on the short-term and fail to consider the longer-term fundamentals needed for planning. In forming this price outlook, we focus on the underlying fundamentals, recognizing that there will be short-term price volatility that often clouds the bigger picture.

D7 (Cellulosic Diesel) RINs

ABBREVIATED SAMPLE FROM 2023

The volume of D7 RINs has historically been very small, so there has not been sufficient trading to establish a spot market value.

COMPARISON OF OUTLOOKS (REDACTED SAMPLE)

Previous RFS Price Outlooks ($/RIN)

Sources: EPA, Stillwater Analysis
Last Updated: Month Year

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