RFA is pushing for a suspension of RINs generation on UCO/Tallow import portion of Biodiesel/Renewable diesel produced until the conclusion of the EPA investigation on UCO. It should be noted that the letter from the RFA does not address the Carbon intensity impact of such a decision as clearly Corn oil and Soybean oil would increase carbon intensity for many producers beyond economic viability under LCFS and later in 2025 under IRA 45z. The increase of 600Kt of total Tallow and UCO from 2023 to 2024 is relatively normal considering CI economics this year but it has been devastating for Soy crushers particularly. RFA does not address how it will be treated under IRA starting 1Jan2025 as clearly operating under IRA without significant UCO and Tallow imports would be devastating for the industry. It is unlikely that EPA would take a decision any time this year considering that we are in an election year. Any decision would also impact the fossil fuel industry which is now also heavily invested in renewable diesel, am doubtful of any action other than perhaps banning lower IV UCO from imports as it would eliminate the possibility of palm oil being present. This would definitely anger China as it is difficult to identity-preserve UCO batches in the collection process as Chinese cooking requires many different types of oil for cooking with also some oils that are more dominant in certain regions.
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