The U.S. Environmental Protection Agency (EPA) has implemented new rules for the Renewable Fuel Standard (RFS) that will dramatically increase the mandate for biomass-based diesel, a move drawing criticism from environmental experts. The updated regulations, which took effect for the 2026-2027 period, call for an approximately 70 percent increase in biomass-based diesel requirements compared to the 2025 baseline. This expansion of the RFS, a program designed to incorporate biofuels into the nation's fuel supply, is notable as it comes from an administration often seen as deregulatory on environmental matters.
While the RFS ostensibly aims to reduce greenhouse gas emissions by substituting fossil fuels with renewable alternatives, critics argue that the current iteration, particularly its reliance on crop-based biofuels like soybean oil, has the opposite effect. Few experts outside of agricultural lobbying groups defend the RFS in its current form as sound policy, suggesting it primarily serves to guarantee markets for corn and soy growers, industries that President Donald Trump has sought to support.
Environmental Impacts of Crop-Based Biofuels
Research indicates that biofuels derived from food crops, such as corn ethanol and soybean oil-based diesel, may be as harmful, if not more so, to the climate than conventional fossil fuels. A primary driver of this concern is land-use change. Mandating large volumes of biofuels necessitates expanding agricultural land, often at the expense of natural habitats. A study examining the RFS between 2008 and 2016 found that the program contributed to the conversion of approximately 4.45 million acres of natural and semi-natural areas into cropland within the U.S. Clearing these areas for agriculture releases significant greenhouse gases from vegetation and soil disturbance, undermining the climate benefits of the fuel itself. One analysis suggested that the carbon intensity of corn ethanol produced under the RFS is comparable to or even higher than gasoline.
Global Ramifications
The environmental consequences extend beyond U.S. borders. Increased demand for soybean oil for biofuel production, driven by the RFS and similar international policies, has driven up global vegetable oil prices. This price increase incentivizes farmers worldwide to cultivate more oil crops, leading to deforestation in ecologically sensitive regions, particularly tropical forests. In Southeast Asia, demand for vegetable-oil-based diesel has been linked to the conversion of millions of acres of forestland in Indonesia and Malaysia into palm oil plantations between 2002 and 2018. Studies accounting for these indirect land-use changes suggest that vegetable-oil-based diesel can emit 22 to 52 percent more greenhouse gases than petroleum diesel.
These forests are critical carbon reservoirs and habitats for endangered species like orangutans. Agricultural economist Richard Sexton, a co-author of a relevant study, stated, "We are deforesting Indonesia and Malaysia due to our biofuel policies." Beyond environmental destruction, diverting crops to fuel production also exerts upward pressure on global food prices, disproportionately affecting low-income populations.
Policy Challenges
The Renewable Fuel Standard has become politically entrenched, supported by a broad agricultural lobby. While the transition to electric vehicles may eventually reduce the demand for crop-based biofuels in road transportation, current policies continue to drive their expansion. Environmental advocates suggest that the EPA could alter its rules to curb the growth of soy-based diesel and limit further acceleration of these environmentally damaging practices. The recent RFS mandates are projected to lead to the largest increase in soy-based diesel use in the program's history.