What factors influence the price of RIN credits ?
A.: Demand is driven by the annual RFS standard so it is very inelastic. The price of RIN credits is affected by a number of factors in addition to the current years mandate of renewable fuel. The following represents a partial list factors impacting the price of RINs:Transportation cost The cost to transport ethanol and other bio fuels plays a key role in the overall RIN value. RFS mandate The mandated level of renewable fuel (the Renewable Fuel Standard) for the specific year establishes the demand and drives price.Vintage year Current vintage year RINs will have more value than RINs from the prior year.Blend properties The physical properties of bio fuels, such as octane, vapor pressure, etc., compared with that of petroleum products is a consideration.Petroleum product prices The price of bio fuels compared with the price of petroleum products is a factor in the RIN value.Sustainability purchases RINs purchased and then retired as a mechanism to support a sustainability initiative
A.: Demand is driven by the annual RFS standard so it is very inelastic. The price of RIN credits is affected by a number of factors in addition to the current years mandate of renewable fuel. The following represents a partial list factors impacting the price of RINs:Transportation cost The cost to transport ethanol and other bio fuels plays a key role in the overall RIN value. RFS mandate The mandated level of renewable fuel (the Renewable Fuel Standard) for the specific year establishes the demand and drives price.Vintage year Current vintage year RINs will have more value than RINs from the prior year.Blend properties The physical properties of bio fuels, such as octane, vapor pressure, etc., compared with that of petroleum products is a consideration.Petroleum product prices The price of bio fuels compared with the price of petroleum products is a factor in the RIN value.Sustainability purchases RINs purchased and then retired as a mechanism to support a sustainability initiative
