EPA Sticks To Controversial RFS Rule

EPA RFS Rule 122019
The Renewable Fuel Standard dictates how much biofuels must be blended into the nation's gasoline and diesel supplies ( MGN )

The Environmental Protection Agency (EPA) made only minor tweaks to a proposed rule for the Renewable Fuels Standard (RFS), drawing protests from a key senator and an array of biofuel and commodity groups.

The controversy surrounds small refinery exemptions (SREs) that allow some refiners to bypass requirements to blend ethanol and other biofuels. An agreement was reached in September that Senator Chuck Grassley (R-Iowa) said would have re-allocated those lost gallons on a three-year rolling average. Instead, EPA is adjusting for exempted gallons based on Department of Energy estimates of needed waivers.

EPA says that rule is designed to maintain a net floor of 15 billion gallons of ethanol use under the RFS.

But negative response was quick from biofuels groups and Grassley, who has been a key negotiator in the RFS dispute.

“Once again, EPA is playing games and not helping President Trump with farmers,” Grassley said in a statement. “An agreement was reached on September 12 in an Oval Office meeting between several Midwest leaders, President Trump and other members of his Administration. This does not reflect what we agreed to in that meeting. Simply requiring that the three-year rolling average be based on hard data and actual waived gallons rather than Department of Energy recommendations and EPA discretion would solve this problem and ensure the renewable volume obligations are met. Administrator Wheeler has put the president in a bad situation by not following the law as intended by Congress and as the president has promised to uphold. 
 
“No matter what EPA says about the impact of its waivers to oil companies making billions in profits, farmers and biofuels producers know and feel the negative impact of the agency’s actions. I will hold EPA’s feet to the fire to make certain they abide by the Department of Energy’s recommendations and ensure integrity in the RFS. Whether that happens is up to Administrator Wheeler and the president’s support among farmers is in his hands,” Grassley continued.
 

Listen to Senator Grassley discuss the EPA rule for the RFS on AgriTalk Radio in the player below:

 

In the Thursday announcement, EPA set the 2020 target volume for corn ethanol at 15.8 billion gallons with an expectation that, after small refinery waivers, the total blended ethanal volume will net out at 15 billion gallons.

“President Trump turned his back on certainty for farmers and failed to keep the September 12 deal,” said Iowa Renewable Fuels Association (IRFA) Executive Director Monte Shaw. “Instead of certainty, we are essentially being told to trust the EPA to uphold the RFS in the future even though for the past three years the EPA has routinely undermined the program. Every farmer and biofuel supporter I have talked to is deeply disappointed, frustrated, and quite frankly angry. I don’t think the White House truly understands the depth of discontent in farm country.”

“Integrity is restored to the RFS only if the agency accurately accounts for exemptions it will grant,” added Growth Energy CEO Emily Skor. “The rule uses an accounting formula based on Department of Energy recommendations, which EPA has a poor track record of following. All eyes will now be on EPA’s next round of refinery exemptions and future targets, which will signal whether Administrator Wheeler is truly committed to ending demand destruction.”

The biofuel targets released by EPA Thursday hold biodiesel volume at 2.43 billion gallons through 2021.

“EPA’s final rule for the 2020 RFS volumes is simply out of step with Congressional intent and President Trump’s promises,” said National Biodiesel Board Vice President of Federal Affairs Kurt Kovarik. “This week, Congress and the president are extending the biodiesel tax incentive through 2022 and sending an unmistakable signal that they support continued growth of biodiesel and renewable diesel. At the same time, EPA Administrator Wheeler is doing everything he can to block that growth.”
 

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