Biofuel backers pressuring EPA to rewrite latest RFS rule

Source: By ERIC WOLFF, Politico • Posted: Sunday, October 20, 2019

Biofuel producers and farmers are pressing the Trump administration to rewrite its proposed fix to the Renewable Fuel Standard — and threatening legal action if EPA tries to finalize its supplemental blending rule.

Producers are demanding changes to the proposed rule because they insist it betrays promises President Donald Trump and EPA officials made to them before the proposal was released on Tuesday. They say the main reason they backed EPA’s Oct. 4 announcement of a boost to biofuels was because Trump and administration officials assured them the rule would require large refiners to make up for demand that has been lost to EPA’s expansion of waivers that exempt small refiners from blending requirements under the RFS.

The announcement preceded release of the proposed rule by over a week, and biofuel backers were stunned when they read the official text.

EPA, however, contends no such promises were made.

“People are not happy,” Sen. Joni Ernst (R-Iowa), a leading defender of the RFS, said Thursday. “They feel that once an agreement is reached, they should be standing by that agreement.”

Ernst said she would be meeting with EPA Administrator Andrew Wheeler later on Thursday to make the case for the proposal to be reconsidered.

But EPA’s proposal relies instead on the number of gallons DOE recommends that EPA exempt from the blending requirements, which would work out to a far lower reallocation amount. DOE recommended between 2016 and 2018 an average of 770 million gallons for exemption, while EPA actually exempted an average of 1.3 billion gallons.

That change made producers and farmers feel like they were duped.

In addition, EPA publishes the total number of gallons it waives, but DOE’s recommendations are not typically made public out of concern for the confidential business information of small refiners that apply for exemptions. Biofuel producers say they are unwilling to take EPA officials at their word that the final number will be 15 billion gallons.

“There’s no trust left with EPA whatsoever,” said Geoff Cooper, president and CEO of the Renewable Fuels Association, an ethanol producers trade association. “They are asking us to trust that they are going to follow DOE recommendations on these exemptions when all they’ve done is ignore those recommendations for several years. They’re asking us to make a leap of faith we’re not willing to make.”

Senators grilled USDA Deputy Secretary Stephen Censky over the RFS controversy at an Agriculture Committee hearing Thursday, with Sen. Tina Smith (D-Minn.) calling the rule “a bait and switch.”

Censky promised producers would get their full mandate. “I can assure you directly from conversations with the president, the president is insistent that EPA administer this to make sure that we achieve 15 billion gallons,” Censky said. He added that Agriculture Secretary Sonny Perdue spoke to Wheeler on Friday and confirmed that the agency “very much plans to administer it to make sure that we achieve that 15 billion gallon target.”

Grant Kimberley, executive director of the Iowa Biodiesel Board, a biodiesel trade association in the state, said Trump’s promise that reallocation would be based on actual gallons waived was made during a September meeting with biofuel advocates at the White House. And just last week, at a public event after EPA’s announcement, Trump raised biofuel producers’ hopes when he said EPA would be requiring 16 billion gallons of blending, a volume that exceeds what is allowed under statutory schedules.