The Environmental Protection Agency (EPA) has set a more ambitious goal for the production of cellulosic biofuels in 2012 requiring that 8.65 million gallons of cellulosic biofuels be used in 2012, up from the 6.6 million gallons it required in 2011. EPA said the 31-percent increase over 2011 levels would drive growth in the fledgling industry. The 8.65 million gallons is still far below the 500 million gallons originally required by statute.

The cellulosic requirements are part of the larger Renewable Fuel Standard target for 2012.  Refiners and and other blenders will have to use the equivalent of 15.3 billion gallons of ethanol, cellulosic biofuels, biodiesel and similar renewable fuels this year.  This compares with 13.95 billion gallons that EPA required in 2011.  EPA set a requirement of 1 billion gallons for biomass-based diesel in 2012, but will not make a decision on 2013 volumes for biomass-based diesel fuel until later this year, saying more analysis was needed.

EPA’s decision was criticized by the National Petrochemical & Refiners Association (NPRA), saying the agency acted “unwisely.”  “Once again, refiners are being ordered to use a substance that is not being produced in commercial quantities–cellulosic ethanol–and are being required to pay millions of dollars for failing to use this non-existent substance,” NPRA President Charles Drevna said in a statement.