Siding with biofuels industry, EPA takes new position on Small Refinery Exemptions

The Environmental Protection Agency (EPA) has announced a new position on Renewable Fuel Standard (RFS) small refinery exemptions. After carefully considering the U.S. Court of Appeals for the 10th Circuit decision from January 2020, the agency now supports the court’s interpretation of the statute. Specifically, EPA now agrees that it may only extend an existing exemption — not grant new or reinstate lapsed ones — and only when the small refinery demonstrates disproportionate hardship as a result of the RFS itself.

“EPA supports that court’s interpretation of the Renewable Fuel Standard small-refinery provisions,” the agency said in a statement.

On January 8, 2021, the U.S. Supreme Court granted a petition from small refineries –HollyFrontier and Wynnewood – to review the Tenth Circuit’s ruling. EPA’s announcement signals it will now support the 10th Circuit decision in that case.

The National Biodiesel Board welcomed the announcement.

“We appreciate EPA’s effort to restore integrity to the RFS and set consistent criteria for decisions on exemptions,” Vice President of Federal Affairs Kurt Kovarik said. “The 10th Circuit Court set a reasonable standard that EPA’s authority is limited to extending existing exemptions. We applaud EPA’s agreement with that interpretation.”

EPA’s announcement gave no additional information on how the agency will approach dozens of pending exemption petitions, including those filed last year for 2011 and 2012 exemptions.

In Minnesota, biodiesel contributes nearly $1.7 billion in economic activities, and adds about 5,400 jobs to the state. The first state to adopt a minimum blending requirement, Minnesota moved to B20 (20% biodiesel) in 2018 during the summer months. Recently, Minnesota Soybean Growers Association Treasurer Bob Worth participated in Gov. Tim Walz’s Council on Biofuels.

“Minnesota has long been a leader in biodiesel, and we’re optimistic we’ll continue to be at the forefront of the nation’s use of renewable fuels,” Worth said.

The Minnesota Biofuels Council said EPA’s decision is a step in the right direction.

“While we have a strong and supportive biodiesel policy in Minnesota, it needs to be backed up by good polices at the federal level, like the RFS, so we can continue to build a stronger place in our country’s energy future,” said Mike Youngerberg, executive director of the Minnesota Biodiesel Council.

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