EPA says US trade in renewable fuel credits (RINs) jumps 2000 percent in December

The EPA said that US trade in renewable fuel credits jumped 2000 percent in usage in December. Under the US renewable fuel trading system, biofuels producers generate renewable fuels credits which transfer to the purchasers of the fuel.

Refiners and fuel marketers are required to have credits that prove they have met their obligations under the Renewable Fuel Standard, but can buy or sell excess credits.

The credits, called RINs, trade for 2-3 cents per RIN. Fuel marketers who come up short on RINs and cannot purchase them on the market, can purchase them from the EPA. The EPA price is the greater of 0.25 cents per gallon, or $3.00 less the wholesale price of gasoline. Currently the EPA price works out to around seventy cents.

The Renewable Fuel Standard calls for 36 billion gallons of biofuels to be blended with conventional gasoline by 2022. US presdential candidates Mike Huckabee and Barack Obama have endorsed a cap-and-trade system for emissions, as well as the trading credit system for fuels.

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