On Thursday, EPA decided the fate of the 2018 Small Refinery Exemptions (SREs) under the Renewable Fuels Standard (RFS) by moving to deny 36 of the waivers. However, the agency will offer relief for the 31 waivers previously granted.
EPA says it will allow 31 facilities to meet their 2018 obligations without purchasing credits to show compliance with the law due to “extenuating circumstances” rooted in each refinery’s initial waiver grants, according to EPA’s Communications Director Nick Conger.
What Does This Mean for Refiners?
Obligated parties under the RFS program comply by blending renewable fuels with conventional gasoline. Oil refiners seeking exemption from biofuel blending laws do not have to blend to the standard set by the EPA each year under the Clean Air Act.
When these waivers were authorized in 2018, the renewable fuel blending target was set for 26 billion gallons.
In an AgriTalk episode on Thursday, Renewable Fuels Association (RFA) Chief Economist Scott Richman shared the EPA used public and private data to complete a “thorough” analysis in 2021 that showed there’s no need for SREs.
“They found that small refineries, just like other refineries, are able to pass through the wholesale prices, RIN (Renewable Identification Number) prices, and that there’s no disproportionate economic hardship keeping these refineries from meeting the RFS,” he said.
Richman says the EPA pulling back on these waivers “shouldn’t mean much” for the refiners due to the lack of economic hardship evidence.
A Page from the History Book
Former President Donald Trump allowed over 30 SREs in 2018, igniting a successful court case from biofuel advocates.
In December, at the EPA’s request, the U.S. Court of Appeals for the District of Columbia Circuit sent the matter back to the agency for further review. The court gave the EPA 120 days to issue new decisions, with the deadline of today.
