EPA’s New Rule Set to Accelerate Biofuels Production, Opening Door for Renewable Propane

Higher blending mandates for ethanol, biodiesel and renewable diesel could spur demand for biopropane as the Renewable Fuel Standard expands through 2027.

The Environmental Protection Agency finalized its “Set 2” Renewable Fuel Standard (RFS) rule this week, raising the annual blending requirements for ethanol, biodiesel and renewable diesel for the next two years. The rule, which was adopted after a lengthy public comment period, lifts the 2025 ethanol mandate to 15.6 billion gallons and pushes biodiesel and renewable diesel targets to 3.1 billion gallons each. While the language focuses on traditional liquid biofuels, the EPA explicitly noted that producers of biopropane—also known as renewable propane—could benefit from the expanded domestic biofuel mandate.

Renewable propane is produced by upgrading biogas or by hydrogenating bio‑derived feedstocks, yielding a propane‑like fuel with a carbon intensity up to 90 percent lower than conventional propane. Industry analysts estimate that the new RFS volumes could create an additional 150–200 million gallons of market opportunity for renewable propane by 2027, especially in regions with strong agricultural waste streams. “The rule sends a clear signal that the EPA is committed to expanding the role of advanced biofuels, and that includes renewable propane,” said Mark T. Clevenger, senior policy director at the National Propane Gas Association.

For propane distributors and retailers, the rule may translate into new blending contracts, infrastructure upgrades, and a need for tighter compliance tracking. Companies that can demonstrate low carbon intensity and traceable feedstock sources will be best positioned to capture contracts under the RFS credit system. In addition, the EPA’s acknowledgment of renewable propane could stimulate federal and state grant programs aimed at expanding production facilities, further lowering the cost curve for the technology.

As the industry pivots toward greener fuels, operational efficiency and safety remain paramount. Tools like Tankspotter.com can help emerging renewable propane producers manage field inspections, documentation, and compliance reporting—all essential as the market scales under the new EPA rule.