D6 RIN, Ethanol Price Parity Heightening Push for Year-Round E15 Access: RFA
Chicago spot ethanol prices and D6 Renewable Identification Number (RIN) credit values converged this week, with D6 RINs trading above the value of physical ethanol with attached credits — the first time in the history of the Renewable Fuel Standard (RFS) — effectively reducing the net cost of ethanol blending relative to spot gasoline blendstock prices.
OPIS assessed prompt Chicago Argo ethanol at $1.9360/gal on Thursday, while D6 RINs were assessed at $2.01625/RIN, down less than 1ct from an all-time high of $2.0225/RIN on Wednesday. At the same time, OPIS-assessed spot Chicago CBOB prices settled at $3.7085/gal.
Recent gains in D6 RIN prices followed stronger finalized Renewable Volume Obligations (RVOs) for 2026 and 2027 from the U.S. Environmental Protection Agency (EPA), released March 27, which market participants said have tightened expected compliance balances and improved blending economics for renewable fuels.
In a blog post published this week, Geoff Cooper, president and CEO of the Renewable Fuels Association, called attention to how a refiner or blender purchasing ethanol with an attached D6 RIN can effectively offset nearly the full cost of the physical ethanol gallon by separating and selling the credit into the market.
“I think what you’re seeing in the market today just underscores the extraordinary and really unprecedented value and economic benefits of blending ethanol currently,” Cooper told OPIS.
“You can spend $2 today and get a gallon of ethanol and a D6 RIN, and that RIN credit by itself is worth $2, so depending on how you look at it, you’re getting a free RIN with a gallon of ethanol, or you’re getting a free gallon of ethanol with the RIN. It screams that we should be using more ethanol. That RIN credit is doing its job to provide that incentive and economic signal to get more ethanol into the fuel supply,” Cooper said.
Under the RFS, ethanol producers generate D6 RINs when renewable fuel is produced. Those credits remain attached to the physical gallon until blending or purchasing by refiners, when they can be separated and traded independently for compliance purposes.
The inverted pricing relationship between D6 RIN credits and spot ethanol prices comes as debate continues in Congress over proposed legislation that would allow year-round sales of E15 gasoline nationwide and modify provisions tied to small refinery exemptions (SREs) under the RFS.
The U.S. House of Representatives is expected to consider a floor vote on a standalone E15 bill on May 13 after lawmakers stripped the ethanol provision from inclusion in the recently passed Farm Bill 2.0. If passed in the lower chamber, the E15 provision would be sent to the Senate for consideration.
Cooper added that critics of expanding higher ethanol blends have argued that RFS compliance costs raise fuel prices and pressure refining margins. Refiners that do not blend enough renewable fuel must acquire RINs in the open market to satisfy annual compliance obligations.
“We still have a number of refiners out there suggesting that E15 or blending more ethanol will somehow increase gasoline prices, and that’s just completely absurd and ludicrous,” Cooper said.
Reporting by Bryan Sims, bsims@opisnet.com; Editing by Jordan Godwin, jgodwin@opisnet.com