Tesla aims to enter the U.S. renewable fuel credit market, being one of eight companies pending consideration by the EPA. If the manufacturer achieves the goal, then this will contribute to obtaining significant profits.
Tesla, like the other seven companies, is pending consideration of applications filed with the Environmental Protection Agency tied to power generation and renewable credits, according to two sources, Reuters reported. EPA maintains a pending application list with some details but does not mention company names. Tesla's entry has the potential to reshape the renewable credit market created to boost investment in the U.S. biofuel industry. Tesla's application is likely to be related to power generation associated with biogas. The Biden administration will review EPA filings this summer, two sources said.
Such changes could represent the largest expansion of the Renewable Fuel Standard (RFS) program, aimed at boosting rural America and weaning the country off oil imports. The entry of Tesla and other EV makers into the renewable energy scheme could attract investment in the infrastructure network, including EV charging stations.
It will also result in U.S. oil refining companies having to buy loans known as RINs, generated by Tesla and other alternative fuel suppliers. Thus, they will subsidize an electric car company whose goal is precisely to take petrochemical refineries out of business. Tesla would generate the most lucrative type of credits, known as D3s, which trade at a significant premium to the larger pool of traditional ethanol credits.
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About the Author
Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.