Clean Fuels Industry Future Bright Despite ‘Brutal’ 2025: CFAA Chief
ORLANDO, Fla. — Last year was a “brutal” one for the clean fuels industry, an official said Tuesday, but the future remains bright.
“Let me be direct: 2025 was a brutal year for our industry,” Donnell Rehagen, chief executive of Clean Fuels Alliance America (CFAA), stated during opening remarks for the group’s annual conference.
Twelve months ago, the industry was “coming off one of our best years ever,” according to Rehagen.
“This past year was the opposite,” he lamented. “Deep uncertainty over 45Z tax credits made it virtually impossible to plan and run a biodiesel business. Questions about the Renewable Volume Obligation (RVO) from EPA — including the timing and whether they’d eventually undermine the strongest proposed RVO we’ve ever had by granting the backlog of small refinery exemptions — created paralysis for the market.”
The industry witnessed significantly slower production across biodiesel, renewable diesel and sustainable aviation fuel, Rehagen said.
He added, however, that “in the midst of these challenges, the foundations of our industry have held strong.”
As a result, he said, EPA’s proposed 2026 volumes are expected to be more than 2 billion gal above last year’s levels, “by far the largest single year jump in program history.”
“On top of that, starting in 2026, Treasury will exclude indirect land-use change from lifecycle greenhouse gas calculations for those 45Z credits,” he added. “That levels the playing field for domestic, crop-based biofuels and lowers one of the major headwinds we’ve long confronted. And, the 45Z credits have been extended through 2029.”
Rehagen also detailed what he called recent victories on the state affairs front, citing the California Air Resources Board last month sunsetting the Alternative Diesel Fuel regulation.
“This sunset will now allow higher blends of biodiesel into the renewable fuel pool in our biggest market,” he said. “Blends of B20 will now be possible whereas before, the regulation limited blends to B5 or maybe B10. So, in 2026 we could see twice as much biodiesel in California as we did in 2025.”
Rehagen also pointed to New Mexico, where its Clean Transportation Fuel Standard is being finalized.
“We could see biodiesel and renewable diesel playing a very significant role in their decarbonization efforts,” he stated. “Potential demand for our fuels could reach 720 million gallons in New Mexico.”
Rehagen cited Washington state as well, where he said legislation passed last year “increased the Clean Fuel Standard carbon reduction target from 20% by 2038 to 45% by 2038 and potentially up to 55%.”
“This new legislation has the potential of increasing demand for our fuels from its current 150 million gallons to 337 million gallons, and potentially 550 million gallons,” he claimed.
Rehagen also referenced Pilot, the nation’s largest travel center network, last year opening three B99 pumps for commercial fleet use in Illinois, Texas and Iowa.
“This move sets a milestone in sustainable energy by bringing B99 into the travel center space,” he noted.
CFAA will continue to “innovate relentlessly,” according to Rehagen, adding: “Scale, logistics, feedstock advancements — every efficiency we gain, everycost we reduce, every quality standard we exceed makes us harder to ignore and impossible to replace.”
Reporting by Michael Schneider, mschneider@opisnet.com; Editing by Jordan Godwin, jgodwin@opisnet.com