Tesla seeks entry into US renewable fuel credit market

NEW YORK: Tesla is seeking to enter the multibillion dollar US renewable credit market, hoping to profit from the Biden administration’s march toward new zero-emission goals, two sources familiar with the mater said.

The electric car maker is one of at least eight companies with a pending application at the Environmental Protection Agency tied to power generation and renewable credits, the sources said. The EPA produces a list of pending applications with some details, but not companies’ names.

Tesla’s entry could potentially reshape the renewable credit market, established in the mid2000s to boost investment in the US biofuel industry. The market generated some 18 billion credits in 2020 and is currently dominated by ethanol producers. Tesla’s application would likely be tied to the production of electricity associated with biogas.

The Biden administration is expected to review the EPA applications and lay out how electric vehicles could qualify for tradable credits under the Renewable Fuel Standard (RFS) this summer, the two sources said.

The move could represent the largest expansion of the RFS programme that was created by President George W. Bush and aimed at boosting rural America and weaning the country off oil imports.

The entry of Tesla and other electric vehicle makers to the renewable energy scheme could atract investment for a much-needed infrastructure network, including charging stations, for electric vehicles.