The Trump Administration announced Friday that it is taking action to begin reversing the damage done to rural America by refinery exemptions from the Renewable Fuel Standard (RFS). The plan requires the Environmental Protection Agency to keep the statutory RFS volumes whole by prospectively redistributing exempted renewable fuel blending requirements to non-exempt refiners.
In a joint statement, the National Corn Growers Assn., the American Soybean Assn., Growth Energy, the Renewable Fuels Assn. (RFA), the National Biodiesel Board (NBB) and Fuels America -- the affected industry groups -- thanked President Donald Trump for the actions.
“Efforts to restore hope for rural communities cannot come soon enough, and we will continue to work closely on that process with our elected champions and this White House until a plan is finalized and gallons start flowing again. The EPA must uphold the President’s commitment to restore demand, based on a three-year average of all the exempted gallons, beginning with the 2020 biofuel standards,” the groups noted.
EPA will publish an official rule-making as soon as next week to solicit comments on how to expand biofuel requirements beginning in 2020 to account for the 31 small refinery exemptions granted in 2019 as well as the 85 total granted in the last three years.
“The plan announced today takes a crucial step toward repairing the damage done by EPA’s small refinery waivers and re-establishes the RFS as a driver of growth in the production and use of low carbon renewable fuels. Once finalized and implemented, this plan will ensure EPA follows the law in setting annual biofuel blending obligations under the RFS,” RFA president and chief executive officer Geoff Cooper said.
Emily Skor, CEO of Growth Energy, added, “By accurately accounting for lost gallons from this point forward based on a three-year average of all exempted gallons, beginning with the 2020 biofuel targets, and breaking down regulatory and infrastructure barriers to higher biofuel blends, we will be able to realize the true potential of the opportunities President Trump opened by approving year-round sales of E15.”
Jeff Broin, chairman and CEO of POET, the largest domestic ethanol producer, said the action marks a “great victory in the Renewable Revolution.” He said the actions will restore integrity to the RFS and help pave the way for the rollout of year-round E15, “creating a huge win for farmers, biofuel producers and consumers alike.” He cited greater savings at the pump for consumers with the option of E15, which will also lead to increased demand for farmers’ grain.
Nine biodiesel producers from across the country – including in Pennsylvania, Michigan, Texas, Georgia and Iowa – have closed their doors or reduced operations and laid off more than 200 employees. NBB said the announcement is a first step in reversing the loss of production and restoring those jobs.
Kurt Kovarik, NBB vice president of federal affairs, explained, "Proper accounting of the exemptions is vital to ensure that the annual RFS volumes send a reliable signal to biodiesel producers, who are making investments and plans for the future. The biodiesel industry relies on the RFS program to support continued growth and market development. While today's proposal addresses the lost gallons from future exemptions, it does not provide for additional volumes of biomass-based diesel in 2021. We will continue to press EPA to send signals for future growth for biodiesel producers and soybean farmers.”
Sen. Chuck Grassley (R., Iowa) who has been very vocal on the exemptions and advocated to the White House a need for changes, said the plan delivers. Grassley said the solution outlined by Trump, EPA Administrator Andrew Wheeler and Agriculture Secretary Sonny Perdue "is exactly how the RFS is meant to function according to the law as written by Congress."
“I want to thank the President for working with me to bring parity to farmers in my district, and the ethanol industry as a whole, by addressing the issue of small refinery exemptions,” Rep. Rodney Davis (R., Ill.) said. “I recently introduced the bipartisan Small Refinery Exemption Fairness Act to address this issue and re-obligate gallons lost to these exemptions, and I look forward to seeing the details of this plan that will put us on the right path forward.”