New Bill Wipes Out Renewable Fuel Standard: What the End of RFS Means for Gas Prices and Farmers

The new piece of legislation, simply titled the 'Eliminating the RFS and Its Destructive Outcomes Act,' gets straight to the point: it completely repeals the federal Renewable Fuel Standard (RFS) program. This bill targets Section 211(o) of the Clean Air Act, which is the legal backbone for the RFS—the mandate requiring gasoline and diesel to be blended with specific amounts of biofuels, primarily corn-based ethanol. By eliminating this section, the entire structure that dictates how much ethanol must be mixed into your gas tank is dismantled, and the bill includes necessary technical fixes to scrub references to the now-defunct program from other laws, ensuring a clean break.

The End of the Mandate: Who Wins and Who Loses?

The RFS mandate has essentially created a guaranteed market for biofuels, which has been a huge economic driver for the agricultural sector, particularly corn farmers, and the renewable fuel industry. When this program is repealed under Section 2 of the Act, that guaranteed market vanishes overnight. For the companies that produce ethanol and biodiesel, this is a massive disruption; they lose their biggest customer—the federal mandate—and must now compete directly without that regulatory floor. Conversely, traditional petroleum refiners and distributors stand to gain, as they are relieved of the significant compliance costs and blending obligations associated with the RFS.

Shifting Costs and Changing Your Commute

For the average person driving to work, the impact is less about the technical changes and more about potential market shifts. The RFS was designed to diversify the fuel supply and reduce reliance on petroleum. With the mandate gone, the dynamics of the fuel market change entirely. While proponents of the repeal might argue that removing the mandate will lower gas prices by reducing regulatory burdens, the reality is complex. Biofuels often act as a cheaper octane source, and without the RFS pushing ethanol into the supply, refiners might turn to more expensive alternatives, which could actually put upward pressure on prices at the pump. This is a crucial point for anyone watching their budget: the immediate effect on fuel costs is unpredictable, but the removal of a major fuel component could lead to instability.

The Ripple Effect in Rural Economies

This bill doesn't just affect fuel companies; it sends a shockwave through the agricultural supply chain. The RFS created a massive, sustained demand for corn and other feedstocks used to make biofuels. For a farmer who has invested in equipment and land based on the steady demand created by the RFS, this repeal is a major economic threat. It could lead to a significant drop in crop prices and potentially destabilize rural economies that have grown reliant on the biofuel industry. The bill’s impact extends far beyond the refinery gate, directly affecting the livelihoods of countless people in the Midwest and other agricultural regions who rely on the policy that this Act seeks to eliminate.