Heard on the Floor at the National Ethanol Conference: Regulation, a Big Year, and Ethanol Unleashed

The halls of the 2026 National Ethanol Conference (NEC) were charged with a unique mix of triumphant optimism and palpable frustration at some delays, particuarly on nationwide all-year E15. By the numbers, the U.S. ethanol industry is a titan: a record 16.4 billion gallons of renewable fuel produced last year , with exports shattering records at 2.2 billion gallons sent to over 80 countries. Yet, as Renewable Fuels Association (RFA) President Geoff Cooper pointed out, the industry feels like a powerhouse “just waiting for the opportunity to be let off the leash” , constantly held back by “outdated regulations” and “entrenched petroleum providers”.

From explosive regulatory news from the EPA to the “ghost markets” of the future and the bizarre drama of California’s fire marshals, here is your definitive digest of the 2026 NEC.

The “TMZ” Bombshell: RVOs Headed to OMB

The absolute biggest bombshell of the conference dropped during the EPA update. Speculation has been swirling for months regarding the Renewable Volume Obligations (RVOs) for 2026 and 2027 under the Renewable Fuel Standard (RFS). EPA Assistant Administrator Aaron Sabo took the stage to deliver the timeline the industry had been begging for, but he did so with a sharp edge.

“I’m going to break some news,” Sabo announced. “The RFS set two final rule is going to OMB today, and we will be finalizing the rule before the end of March”. This provides critical certainty for a sector that has been operating in a vacuum. Cooper had earlier praised the proposed RVOs for maintaining the 15-billion-gallon volume for conventional corn ethanol and prioritizing domestically produced fuels over imports.

However, Sabo’s remarks were notable for what they didn’t say. In a fascinatng rhetorical shift, the Assistant Administrator’s speech minimized references to environment, cleaner air, or public health outcomes (just one brief acknowledgment that his office overseen by Administrator Lee Zeldin has a “core mission of protecting human health and the environment”). Instead, his focus was squarely on “deregulatory action” and “consumer choice”.  neergy realism and dominance, and statutory authority. 

45Z: The Billion-Dollar “Modeling” Guessing Game

The impending 45Z Clean Fuel Production Credit was perhaps the most polarizing topic on the floor. While Cooper views 45Z as a historic opportunity to spur a wave of innovation not seen since the original ethanol boom 20 years ago, the lack of a final GREET model has producers flying blind.

“The model is really the whole ball game,” Cooper warned, noting that the fine print will determine if a tax credit is worth $1.00 per gallon or nothing at all. The industry is specifically watching how “indirect land use” (iLUC) is handled and whether new pathways like corn kernel fiber will be included.

The skepticism on the floor was palpable. Some stakeholders argued that shifting the policy from a blender’s credit (40A/40B) to a producer’s credit (45Z) was a strategic error. They argued the new framework is “super, super complicated,” making it nearly impossible to track how a cash credit attaches to a physical volume as it moves through the value chain. The fear? That the credit’s value will be absorbed by middlemen and never reach the consumer’s wallet to drive demand.

The E15 Goal-Line Stand: Who Killed the Deal?

If there was one unifying theme at the NEC, it was sheer exhaustion over the gridlocked battle for year-round, nationwide E15. Cooper recounted the “heartbreaking defeat” in Congress last year when E15 legislation was stripped from a continuing resolution at the last minute, comparing the failure to Charlie Brown having the football pulled away by Lucy.

The “Villains” in the Room

The sabotage didn’t come from “Big Oil” at large, but from a “handful of mid-sized oil refining companies”. Cooper identified these as Fortune 500 companies—some with foreign ownership—that masquerade as “small” to protect their access to Small Refinery Exemptions (SREs).

These refiners claimed that losing their exemptions would cause refinery shutdowns and layoffs, a claim Cooper dismissed as “complete and utter nonsense”. By mounting a “goal-line stand,” this vocal faction created enough doubt on Capitol Hill to have the E15 language pulled from the recent appropriations bill.

The Stakes and the Chaos

The lack of a federal fix means the industry remains stuck in a cycle of “emergency summer waivers.” This status quo is punishing everyone:

• Retailers: Jake Wilson of RaceTrac noted that the “emergency” nature of these waivers prevents predictability. When a waiver expires, retailers are forced to put “yellow bags” on pumps, which nukes consumer trust.
• Refiners: API representative Will Hupman revealed that last year’s last-minute waivers left refiners with “stranded investments”. They had already manufactured and shipped expensive, low-volatility fuel to Midwest terminals, only to have the premium value of that fuel vanish when the EPA issued a late-hour waiver.
• The States: The pressure is now at a breaking point. Kansas Governor Laura Kelly has threatened to join the Midwest “opt-out” movement by April 1 if Congress continues to stall, which would further balkanize the U.S. fuel system.

California’s Paradox: The Fire Marshal and the Supply Cliff

California continues to be the industry’s most surreal battleground. On one hand, the state is a success story: E85 is currently selling at staggering discounts of up to $2.00 per gallon compared to standard gasoline. On the other hand, the state is facing a supply catastrophe. With two major refinery closures set to wipe out 20% of in-state refining capacity by April, California will soon be forced to import 65% or more of its fuel from overseas.

“E15 is going to be our saving grace on the supply side,” noted Alessandra Penasco of the California Fuels & Convenience Alliance. Yet, a “rogue” fire marshal has thrown up a last-minute roadblock, claiming that the state’s unique—and vastly outdated—Stage II vapor recovery nozzles must be certified for E25 before E15 can flow.

Penasco confirmed that retailers would be “jumping for joy” to ditch the expensive Stage II equipment entirely. It is a redundant relic of the past; modern cars already have onboard vapor recovery systems that make the nozzles unnecessary. Once this bureaucratic hurdle is cleared, industry leaders expect E15 to become the base fuel offering in California, potentially displacing E10 entirely across the Golden State.

“Ghost Markets”: The SAF and Marine Silence

While the podium saw mentions of Sustainable Aviation Fuel (SAF) and Maritime opportunities, the floor buzz suggested these remain “ghost markets” for now. Cooper spoke passionately about the global maritime market—a 70-80 billion gallon behemoth where alternative fuels currently make up less than 1% of use.

“Even getting a small piece of that would be enormously impactful,” Cooper said, noting that ethanol is well-positioned as a scalable, low-carbon alternative for shipping. However, the conference’s primary oxygen was consumed by the immediate domestic dogfight over the gas pump. For an industry producing record corn crops and facing “the worst economic conditions in nearly 50 years” for farmers, these new frontiers are no longer luxuries—they are necessities.

The Bottom Line

The 2026 National Ethanol Conference made one thing abundantly clear: the U.S. ethanol industry is primed for a massive expansion, provided the government gets out of its own way. From the imminent delivery of the RVOs to the high-stakes implementation of 45Z and the ongoing brawl for E15 market access, the pieces are on the board. As Geoff Cooper perfectly encapsulated the mood of the room: “We just need the chance to compete. We need the opportunity. We need to be unleashed”.

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