Why are RIN Prices Falling?

Current RIN Prices

RIN prices have been falling over the past six months (Figure 1). The fall began around the time EPA published their RFS volume targets for 2023-25 on June 21, 2023. According to PFL Petroleum’s Jan 29 report, D4 and D6 RIN prices closed at $0.57/RIN and $0.56/RIN respectively. This is a large drop from the prices over $1.50/RIN seen a year ago, though RIN prices remain higher than they have been in the more distant past. In 2019 for example, D6 RINs were below $0.25/RIN. This article examines factors contributing to lower RIN prices. 

Figure 1. RIN Prices

Background on RFS

The RFS is legislation mandating a certain amount of renewable fuel be blended with the conventional fuel supply each year. RINs are credits generated by biofuel producers when they produce qualifying renewable fuels. The RINs are then used by obligated parties (fuel blenders) to show compliance with the RFS. Obligated parties can get RINs by buying renewable fuels and getting the RIN with the...