The Biden administration is considering lowering the ethanol blending mandate below the proposed 15 billion gallons for 2022 amid strong opposition from the refining lobby and labor unions, who believe the shrinking U.S. ethanol industry can no longer support that goal, according to two sources familiar with the administration's thinking.

After his predecessor Donald Trump took the unprecedented step of lifting a requirement from refiners, President Joe Biden vowed to bring back into line a law requiring refiners to blend biofuels such as corn-based ethanol into the nation's gasoline pool.

But Biden found it hard to follow through on his promises. The coronavirus pandemic has curbed fuel consumption and triggered the shutdown of several ethanol plants. Higher regulatory costs have refiners threatening to shut down refineries and lay off high-paying union jobs.

In December, the Environmental Protection Agency released a long-awaited biofuel blending mandate proposal that cuts ethanol demand in 2020 and 2021, but restores it to 15 billion gallons in 2022. Farmers and biofuel producers criticized the rollback, but welcomed this year's recovery.

But, two sources told Reuters, in recent weeks administration officials have considered lifting the 15 billion gallon mandate when a final rule is issued later this year.

"Epa remains committed to biofuels in the United States," said Nick Conger, an EPA spokesman. "We look forward to reviewing strong comments from all stakeholders before finalizing our rulemaking later this year."

Reuters previously reported that the administration initially planned to set the ethanol mandate for 2022 at 14.1 billion gallons, but under pressure from farm-belt Democrats such as Illinois Senator Tammy Duckworth, decided to increase it by 15 billion gallons.

A source familiar with the discussions said: "The White House is caught between a rock and a hard place. On the one hand, they want to support the agriculture and biofuel industries, but they're being bombarded by unions and refiners who say there's not enough ethanol (ethanol msds), and they're listening." 

Under the RFS, refiners must blend biofuels such as ethanol into their fuel pools or buy tradable credits, known as Rins, from refiners that do. Commercial refiners such as PBF Energy and Monroe Energy have long complained that the cost of buying Rins threatens their plants.