US regulators unveiled much delayed biofuel targets that sought a middle ground for the nation’s contentious renewable fuels policy, but the plan triggered challenges and threats of legal action from two of the biggest industries, oil and corn.

The Environmental Protection Agency (EPA) raised its previous targets for the amount of biofuels to be mixed into motor fuel for the three years to 2016. As expected, the proposed goal was short of the aggressive targets set by Congress in a 2007 law.

The 2014 goal was an increase from a previous proposal, angering the oil industry which opposes more blending. But the biofuel target was lower than most market experts had expected, upsetting the powerful corn lobby. Separately, the government pledged some $100 million in grants to help outfit filling stations to pump biofuel blends using more corn-based ethanol, which makes up the vast majority of the US renewable fuel supply. Some fuels also use biomass-based diesel, largely made from vegetable oils, or cellulosic fuel, made from plant waste.

The EPA proposal was a year and a half behind schedule and followed years of uncertainty over the Renewable Fuel Standard (RFS). The policy, a bedrock of two administrations, is meant to reduce US dependence on foreign oil and utilise cleaner, domestic energy sources.The new volumes represent “ambitious” growth for the renewable fuels industry and go a long way toward meeting goals set by Congress, said Janet McCabe, Acting Assistant Administrator for EPA’s Office of Air and Radiation.