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U.S. Increases 2017 Biofuels Requirements in Victory for Big Corn
NEW YORK, Nov 23 (Reuters) - The U.S. government on Wednesday issued final requirements for biofuel use for next year, saying energy companies must boost the amount of renewables in the nation's fuel supply in a move that drew praise from the biofuels sector after years of criticism.
The Environmental Protection Agency (EPA) in a statement set the target for total renewable fuel use at 19.28 billion gallons for 2017. That includes 15 billion gallons for conventional biofuel, which is mainly corn-based ethanol, and 4.28 billion gallons for the advanced biofuels mandate, confirming figures Reuters previously reported.
The final plan is up from the 18.8 billion gallons the Environmental Protection Agency proposed in May and marks a 6 percent increase from this year's 18.11 billion gallons. While many anticipated an increase for the conventional fuel target, that increase alongside the boost for advanced biofuels was more than many expected.
The EPA is required to set targets by the Renewable Fuel Standard, with annual mandates for how much ethanol and biodiesel need to be blended with gasoline and diesel. The program, signed into law by President George W. Bush, was designed to curb greenhouse gas emissions, promote energy independence and boost rural economies.
"The final volumes represent continued growth over historic levels," EPA said in the statement on its website.
The agency set the mandate for biomass-based diesel at 2.1 billion gallons for 2018.
The increase to 15 billion gallons for the conventional biofuels target marked a victory for the U.S. ethanol industry, after years of battling regulators to increase the mandates to levels laid out by Congress in 2007.
President Barack Obama's administration pulled back on the targets in recent years due to what it saw as marketplace challenges. The announcement on Wednesday marked the final RFS mandates from the Obama administration, which biofuels advocates previously have said has not gone far enough to promote their fuels.
The final plan immediately drew praise from biofuels advocates and criticism from the oil industry.
"The move will send a positive signal to investors, rippling throughout our economy and environment," said Bob Dinneen, president and chief executive officer of the Renewable Fuels Association.
Shares in oil companies Tesoro, Valero Energy Corp and HollyFrontier Corp were down. Shares of biofuels producers Green Plains Inc and Pacific Ethanol Inc rose after the news. (Reporting by Chris Prentice; Editing by Dave Gregorio and Meredith Mazzilli)
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