API official sees major questions after White House ethanol meeting

Source: By Nick Snow, Oil & Gas Journal • Posted: Tuesday, May 15, 2018

A May 8 White House meeting which tried to address some refiners’ problems with meeting quotas under the Renewable Fuel Standard apparently did not offer adequate solutions to the regulation’s problems, an American Petroleum Institute official suggested on May 14.

Allowing ethanol exports to be counted as Renewable Identification Numbers, which supposedly would put downward pressure on high prices for the renewable fuel credits, and promising to authorize year-round sales of gasoline with a 15% ethanol blend won’t do the job, Frank J. Macchiarola, API Downstream and Industry Operations Group Director Frank J. Macchiarola told OGJ.

“On the E15 waiver, EPA has said it doesn’t have legal authority. It would require legislation to do this,” he explained. API also is concerned that about 75% of the cars on the road today are not built to run on E15, and cars are still manufactured that aren’t warranted for it, Macchiarola said. “We also believe the administration does not have the regulatory authority to allow for year-round E15 sales,” he indicated.

API also is concerned that counting ethanol exports to as RIN credits is contrary to the RFS and would not be able to withstand legal scrutiny, he continued. “Frankly, we think the entire process that is currently being undertaken about trying to find a regulatory fix is a perfect example of how the RFS is broken and needs comprehensive legislative reform. Any part of that should include a sunset provision,” Macchiarola said.

“We oppose the reallocation of volumes, and believe that small refiner exemptions are evidence that the RFS is broken and comprehensive legislative reforms, including a sunset of the program, are needed,” he added.