EPA denies small refinery RFS relief petitions but provides alternatives
The Environmental Protection Agency on Thursday, April 8, denied the 36 petitions for relief from the Renewable Fuel Standard for the the 2018 compliance year that had been remanded by the U.S. Court of Appeals, but provided an alternate compliance approach that allows 31 small refineries to meet their new 2018 compliance obligations without purchasing or redeeming additional RFS credits.
EPA said it is still considering petitions from other refineries for compliance years ranging from 2016 to 2021.
Leaders at the Renewable Fuels Association, Growth Energy, National Corn Growers Association, Clean Fuels Alliance America, American Coalition for Ethanol, and National Farmers Union said they were disappointed with EPA’s decision to allow refineries with previously-granted small refinery exemptions (SREs) to not have to take additional actions to meet their obligations under the RFS by blending more biofuel or purchasing additional Renewable Identification Numbers.
Biofuel and farm advocates had challenged the exemptions in the D.C. Circuit Court of Appeals, forcing the agency to reevaluate its approval during the Trump administration for select oil refiners to avoid their obligations under the Renewable Fuel Standard.
“While today’s decision is an important step in reversing past abuse of refinery exemptions, the decision fails to remedy the economic harms the improperly granted 2018 SREs have already caused,” the groups said.
“Low-carbon biofuels are the single best tool to deliver immediate relief at the pump, strengthen U.S. energy security, and protect the climate. EPA’s move to hold refiners accountable to the law is a welcome step toward getting the RFS back on track that, when applied to pending and future SRE petitions, would improve certainty in the marketplace, and lead to more blending of American-made biofuels.
“However, EPA’s readiness to excuse individual refineries from their obligations to comply with 2018 blending requirements comes at the expense of our biofuels producers, farmers, and American consumers.”
Renewable Fuels Association President and CEO Geoff Cooper said the decision was a “hollow victory” for the biofuels industry, Reuters reported.
EPA said, “The denials issued today apply EPA’s new interpretation of the Clean Air Act SRE provisions, consistent with a U.S. Court of Appeals for the Tenth Circuit holding in Renewable Fuels Association et al. v. EPA. The Tenth Circuit held that SREs may only be granted when a small refinery’s hardship is caused by compliance with the RFS program.”
“Today’s decision changes and remedies EPA’s prior approach to SRE decisions, under which EPA found basis to grant hardship exemptions where no hardship from RFS compliance existed. After reviewing more than a decade of RFS market data, public comments on a proposal EPA issued in December 2021, and confidential information submitted by petitioners, EPA concluded that none of the 36 2018 SRE petitions demonstrated hardship caused by compliance with the RFS program.
“Concurrent with today’s denial action, EPA is also taking action to provide an alternate compliance approach that allows 31 small refineries to meet their new 2018 compliance obligations without purchasing or redeeming additional RFS credits.
“EPA is granting this compliance flexibility because the agency has determined that there are extenuating circumstances specific to this set of petitions, including the fact that SRE petitions were previously granted.This decision is a final agency action.”
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