Source: AEI Ideas
1. Through the first nine months of this year, the share of US petroleum consumption provided by imports fell to a 27-year low of only 34.9%, according to data recently released by the Energy Information Administration. That marks the first time since 1986 that net oil imports for the US have been below 35% (see chart above).
Note that when the first Renewable Fuel Standard (RFS 1) legislation was passed in 2005, increasing dependence on foreign sources of crude oil was one of the main reasons that minimum volumes of biofuels were mandated to be used in the national transportation fuel supply. Although the US was becoming increasingly dependent on imported oil at the time, with net oil imports rising from 33.4% in 1986 to a high of 60.3% in 2005 when RFS 1 passed, the shale revolution has completely reversed that increasing dependency on imported oil in the last 8 years and brought net imports to a 26-year low. With net oil imports back to the levels of the mid-1980s, one of the main justifications for implementing the RFS has completely disappeared.
There are three more reasons that RFS 1 and RFS 2 (passed in 2007) are no longer justified, illustrated in the three graphs below. (more…)