Ethanol blending credits cost refiners at least $1.35 billion

Ethanol blending credits cost independent refiners at least $1.35 billion (€980 million) in 2013, as a result of a sharp increase in price.

The cost, which has trebled since 2012, is a modest approximation as only nine refiners revealed the amount they spent. Other refiners affected by the significant rise in cost did not disclose how much they paid for Renewable Identification Number (RINs), utilised paper credits that meet quotas for blending biofuel into petrol and diesel.

These figures are likely to serve as ammunition when presenting findings to regulators, in the hope of reducing ethanol requirements for 2014.

Independent refiners CVR Refining and LyondellBasell paid over a fifth of the total cost, despite only making up 2.5% of the nation's daily refining capacity.

Similarly, the US's largest refiner, Valero Energy Corp paid an estimated $517 million on RINs last year.

A final decision from the Environmental Protection Agency (EPA) on reducing ethanol requirements for this year is due over the coming months.