The Environmental Protection Agency has accepted a settlement with the oil industry association groups by agreeing to a November 30 deadline for setting requirements under the Renewable Fuel Standard (RFS).

The tentative consent decree comes after American Petroleum Institute and Fuel & Petrochemical Manufacturers filed a lawsuit March 18 over EPA’s failure to meet congressionally mandated RFS deadlines. The Clean Air Act requires EPA to set the annual RFS ethanol mandates by November 30 of the preceding year, but EPA issued the 2013 requirements eight months late and has yet to issue the 2014 or 2015 requirements.

Under the agreement, EPA pledges to propose the 2015 RFS mandate by June 1, 2015, and to finalize the 2014 and 2015 RFS mandates by November 30, 2015. It will also re-propose volume requirements for 2014, by June 1, than reflect the volumes of renewable fuel that were actually used in 2014.

Should the EPA stick to its new November 30, 2015 deadline to finalize renewable volume obligations (RVOs), it will be almost two years late on its 2014 deadline to propose acceptable ethanol RVOs – and nearly one year late for 2015. Biodiesel volumes are now even further behind schedule, and will be a full three years late if the November timeline is maintained.

In a statement the API said they hoped the agreement “helps get the RFS back on track” but continued to call for a long-term solution in a Congressional repeal of the RFS.

Ethanol supporters saw the agreement as a way to provide more certainty to an industry which has been in limbo for the past few years as EPA was unable to make requirement decisions. The National Farmers Union said EPA releasing the target levels would “restore stability to an already damaged biofuels market.”

“No one has benefited from the delays in setting annual renewable volume obligations; and while we are sympathetic to the difficulty EPA faces in promulgating annual targets, the statue is clear about the volumes required and the Agency simply has to do a better job of moving forward,” said Bob Dinneen, chief executive officer of the Renewable Fuels Assn.

A statement from Sen. Heidi Heitkamp (D., N.D.) said the announcement was “another punch in the gut for biodiesel workers in North Dakota and throughout the country, proposing a timeline that’s both unhelpful and out of touch with reality.”

Re-proposed levels

Clearly, ongoing questions will remain as to the volume levels proposed by EPA but EPA has reiterated that it will "re-propose volume requirements for 2014, by June 1, that reflect the volumes of renewable fuel that were actually used in 2014.” 

The volumes for Biomass-based Diesel in 2014 were approximately 1.75 billion gallons so EPA reaffirming its commitment to “actual use” appears to be a step in the right direction, said a statement from the National Biodiesel Board.

Unlike other fuel categories of the RFS, biodiesel volumes – called Biomass-based Diesel under the program – are to be finalized 14 months in advance of the applicable year.

Brooke Coleman, executive director of the Advanced Ethanol Council, said the industry looks forward to working with EPA to make sure that the new RFS proposal supports the commercial deployment of advanced biofuels as called for by Congress. “We were encouraged by EPA’s decision late last year to pull a problematic 2014 proposal, and we are optimistic that EPA will make the necessary adjustments and put the RFS back on track going forward,” Coleman stated.