OAKHURST, N.J. (DTN) -- Ethanol production is expected to average 894,000 barrels per day (bpd) this year and 902,000 bpd in 2016, resulting in an average 9.9% ethanol share of the total gasoline pool in 2015 and 2016, according to the most recent Short-term Energy Outlook released Tuesday, July 7, by the Energy Information Administration.
These estimates are down from 936,000 bpd for 2015 and 937,000 bpd for 2016 in the prior month forecast, and lower than ethanol production at 935,000 bpd in 2014.
"On May 29, the U.S. Environmental Protection Agency proposed a rule setting Renewable Fuel Standard targets for 2014 through 2016. Although these targets could be modified before the final rule is issued, they are used in developing the current STEO," EIA said.
The federal unit said it does not expect measurable increases in E15 or E85 consumption over the forecast period. The proposed RFS targets are expected to encourage imports of Brazilian sugarcane ethanol, which were 3,000 bpd in 2014. Because of the expected increase in ethanol gross imports, net exports of ethanol are forecast to fall from 51,000 bpd in 2014 to 44,000 bpd this year and 36,000 bpd next year.
EIA said it expects the biggest effect of the proposed RFS targets to be on biodiesel consumption, which contributes to meeting the biomass-based diesel, advanced biofuel and total renewable fuel RFS targets.
Biodiesel production averaged an estimated 81,000 bpd in 2014 and is forecast to average 91,000 bpd in 2015 and 98,000 bpd in 2016.
Net imports of biomass-based diesel are also expected to increase from 16,000 bpd in 2014 to 24,000 bpd this year and 35,000 bpd in 2016.
"EIA expects that a combination of higher biomass-based diesel consumption, higher consumption of domestic and import ethanol, and banked Renewable Identification Numbers will help meet the newly proposed RFS targets through 2016."
The agency estimates that carbon dioxide emissions grew 1.0% in 2014 and are projected to decrease by 0.2% this year and then rise by 0.4% in 2016. These forecasts are sensitive to both weather and economic assumptions.
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