EPA wants to put 770 million Renewable Identification Numbers back into the biofuel blending pool after small refinery exemptions carved them out in August. Administrator Lee Zeldin announced the proposal in Iowa, opening a public comment period on two ways to redistribute the volume.

The agency set historically high blending targets in March. Then in August it granted 29 small refinery exemptions, wiping out demand the targets had promised. EPA said at the time it would reallocate the gap between the roughly 990 million RINs it expected to exempt and the 1.76 million RINs actually exempted.

The arithmetic matters to corn growers and ethanol plants. Every waived gallon is demand that never reaches a processor, and blending obligations that refiners do not meet push RIN markets and compliance costs in directions farmers do not control.

What are the two options?

EPA is asking commenters to choose between:

• Splitting the 770 million RINs equally across the 2026 and 2027 compliance years.
• Pushing the entire additional 2025 SRE volume into the 2027 compliance year.

Neither option adds volume beyond what the March targets already set. The proposal restores what the exemptions removed; it does not raise the ceiling.

How did biofuel groups respond?

The industry welcomed the move, though each group flagged a different unfinished item.

Iowa Renewable Fuels Association President Monte Shaw said: "Fully reallocating the lost gallons will ensure the robust 2026-2027 RFS blending levels remain intact, thereby supporting Iowa's biofuels plants and providing the market certainty our industry needs to keep growing." He added that IRFA hopes the rule can be finalized quickly.

American Coalition for Ethanol CEO Brian Jennings framed the stakes in farm-level terms: "Every gallon of renewable fuel displaced by an SRE represents lost demand for American ethanol, lost value for farmers and a missed opportunity to lower fuel costs for consumers." He also argued the SRE fight has stalled a separate priority — year-round E15 — and pressed Congress to pass nationwide E15 legislation before the end of the year.

Clean Fuels Alliance America struck a broader note. Kurt Kovarik, the group's vice president of federal affairs, said CFAA "appreciates Administrator Lee Zeldin's effort to keep the [RFS] volumes on track and to release this proposal earlier than originally promised." He credited this year's RFS proposal with driving billions of dollars of investment in biodiesel, renewable diesel and sustainable aviation fuel capacity in rural America.

What is still uncertain?

The praise assumes the rule survives the comment process intact. EPA has proposed two options, not one, which leaves the final allocation — and its timing across compliance years — open until the agency signs a final rule.

The statements also say nothing about how EPA will handle future SRE petitions, only the 2025 volumes already granted. And the E15 legislation Jennings wants remains with Congress, not the agency.

Until a final rule lands, the 770 million RINs stay a proposal, and the blending levels biofuel groups count on for 2026 and 2027 remain conditional on EPA's follow-through.