Compliance credits for biomass-based diesel and ethanol have doubled in value since the start of the year, with prices surging close to all-time records set in 2021. According to a June 10, 2026 analysis from the U.S. Energy Information Administration, renewable identification numbers (RINs) — the credits generated when biofuels are produced or imported — have jumped primarily because of higher federal biofuel blending targets. The combination of high RIN prices and rising motor gasoline and diesel fuel prices has created an especially favorable market for producing and blending biofuels.
As of June 4, biomass-based diesel (D4) RINs traded at $2.41 and ethanol (D6) RINs traded at $2.37, both near their all-time highs. Because one gallon generates 1.5 RINs for biodiesel and 1.6 to 1.7 RINs for renewable diesel, these fuels currently generate more than $3.50 per gallon of credits. A gallon of fuel ethanol generates 1.0 credit. Relative to motor gasoline prices, the U.S. Gulf Coast fuel ethanol price, adjusted for energy equivalence, has been lower most days since mid-March. The fuel ethanol discount to gasoline has been more than $2 per gallon in May and June when adding in the higher RIN value that blenders can sell on the open market to companies that need to remain in compliance.
The report finds that RIN prices increased in 2026 primarily because of higher blending mandates announced by the Environmental Protection Agency. On March 27, the EPA announced the final Renewable Fuel Standard rule for 2026 and 2027, establishing significantly higher renewable volume obligations than in 2025. According to the analysis, RIN prices increase with high RVOs to reflect the higher profit margins biofuel producers need as incentive to produce enough fuel to meet mandates. The rapid increase in RIN values relative to the Bean Oil-Heating Oil spread in 2026 suggests that the new RVOs are a significant driver of increased RIN values and that biodiesel and renewable diesel production margins are much higher than in 2025.
Under the Renewable Fuel Standard program, RINs are credits generated when biofuels are produced or imported and are used to comply with federal requirements. The EPA sets annual renewable volume obligations for the minimum volume of biofuels that must enter the U.S. fuel supply. Obligated parties — petroleum refiners and motor gasoline and diesel importers — comply either by blending biofuels into petroleum-based fuels or by purchasing RIN credits. Higher prices for petroleum products make fuel ethanol relatively more attractive to blend into gasoline, while high RIN values also support production and blending margins for biodiesel and renewable diesel. When RIN values increase relative to the BOHO spread, as they have in 2026, profit margins for producing biodiesel and renewable diesel generally improve.
The EIA forecasts record-high production of fuel ethanol and renewable diesel in 2026 because of high blend mandates, high gasoline and diesel prices, and increasing production capacity at biofuel plants. Fuel ethanol production increases by 2% in 2026, with the fuel ethanol share of motor gasoline consumption at 10.7%, compared with 10.5% in 2025. Renewable diesel production increases 24% and biodiesel production increases 41% in 2026, compared with 2025. The agency forecasts production of all three fuels to increase further in 2027, when the renewable volume obligation increases further.