Poet verified for D6 RINs

At the end of April, Genscape D6 ethanol Q-RINs were generated within the EPA Moderated Transaction System (EMTS) for the first time.

Four ethanol facilities are now generating Q-RINs, with more expected to come online in the coming months. Genscape is the EPA approved QAP provider for all four of these facilities, including three Poet plants.

'Poet understood early on that a number of its customers would recognise the premium associated with the Q-RINs was small when compared to the value brought by the availability of having an affirmative defence in most instances of fraudulent RINs in the marketplace,' says Bob Whiteman, CFO of Poet Ethanol Products. 'We are increasingly seeing our larger counterparties turn to Q-RINs as a cost-effective way of insuring the quality of their RIN pool, and Poet is proud to be able to offer Q-RINs on all gallons produced by us and our partner plants.'

The introduction of D6 Q-RINs indicates that ethanol facilities see value in QAP services. Obligated parties are showing an interest in D6 Q-RINs as a means to reduce the burden of internal compliance teams, according to market sources close to Genscape.

'By the end of 2015, our analysts expect Q-RINs to represent 5-10% of total monthly D6 RIN generation. In the long-term, D6 QRINs have the potential to become an industry standard,' comments Susan Olson, VP of biofuels at Genscape.

Although not all facilities are currently generating Q-RINs, Genscape's existing client base represents 17% of the D6 renewable fuels market. D4 Q-RINS also have a proven track record of fetching a higher value than their unverified counterparts.

'We regularly transact biodiesel Q-RINs for $0.02 over "second tier", non-QAP RINs,' notes RINs broker Andrew Emerson of Progressive Fuels. 'If a biodiesel producer is struggling to sell there RINs for top tier pricing, we often recommend that they have their facility QAP'd.'

The Genscape QAP is designed to take on the compliance burden by using patented technology to support audit requirements. While most QAP providers require two site visits per year, Genscape's monitoring technology enables the two companies to consolidate multiple audits into a single site visit.