Also known as: Renewable identification number
RINs are essentially records of individual batches of renewable fuel being blended into the US gasoline and diesel pools. RINs are created when a batch of renewable fuel is made. Each batch receives a unique identification number (hence the name). RINs become usable as credits ("released") once the renewable fuel is blended into gasoline or diesel in the US. Once released, RINs can be traded. Refiners and fuel importers in the US are required to provide the EPA with RINs every year based on the volume of gasoline and diesel that they supply into the US market. They largely get these RINs by buying them from the blenders who release them as blending occurs.
The RIN obligation is set each year by the EPA based on an estimate of what US fuel demand will be and a target for renewables use as a share of demand. The obligation is published as the number of RINs that are required for each gallon of fuel supplied by refiners and importers.
There are four different types of RINs that are required for every gallon of fuel supplied. These are:
- Renewable fuel RIN (D6) - These are the most basic RINs and have the highest volume mandate. This RIN is generated by blending corn-based ethanol into gasoline
- Advanced biofuel RIN (D5) - These RINs are created by blending sugar-cane based ethanol, biobutanol or bionaphtha into gasoline
- Biomass based diesel RIN (D4)- These RINs are created by blending diesel made from soybean oil, canola oil, waste oil or animal fats into diesel
- Cellulosic biofuel RIN (D3) - These RINs are generated by blending ethanol made from cellosic material (eg corn stover, wood chips, miscanthus, biogas) into gasoline. Due to the lack of enough cellulosic biofuel, the EPA is able to sell credits to the industry to satisfy this RIN obligation (when matched with a D5 advanced RIN)
The four RIN requirements are "nested" meaning the more advanced RINs count against compliance for less advanced RINs:
- D3 counts against compliance for D5 and D6
- D4 counts against compliance for D5 and D6
- D5 counts against compliance for D6
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