EPA chief tells Congress redistributing waived biofuel volumes would not work

Source: By Meghan Gordon, Platts • Posted: Friday, April 5, 2019

Washington — The US Environmental Protection Agency would not likely be able to reallocate biofuel volumes waived for smaller refineries to larger plants even if Congress passed legislation requiring it, Administrator Andrew Wheeler said Wednesday.

 Senator Roy Blunt, Republican-Missouri, had pressed Wheeler on the impact the small refinery waivers are having on the volume of biofuel blended into US gasoline and diesel supply as required by the Renewable Fuel Standard.

“I think it would be very hard to implement that after the fact,” Wheeler said while testifying to the Senate Appropriations Committee. He added that EPA has lost three lawsuits over its past handling of the small refinery waivers.

Renewable Identification Number prices plummeted last year after EPA expanded the use of the waivers.

S&P Global Platts assessed D6 ethanol Renewable Identification Numbers for 2019 compliance at 14.75 cents/RIN Tuesday, unchanged since Friday, and D6 RINs for 2018 compliance at 11.75 cents/RIN, down 0.25 cent from Monday. D6 RINs started 2018 at 70.5 cents/RIN.

RINs are tradable credits EPA issues to track production and use of alternative transportation fuels. For corn-based ethanol, one gallon of ethanol yields one RIN.

Thirty-nine refineries have applied for exemptions from the 2018 biofuel mandate. The waivers are for plants that process less than 75,000 b/d of crude.

Wheeler said EPA would act on the applications as soon as the Department of Energy forwards its analysis of them.

EPA exempted 35 small refineries from 2017 compliance and is still considering one waiver application. It approved 19 waivers for 2016 compliance, with one still pending. The agency has not denied an application since the 2015 compliance year.

— Meghan Gordon, meghan.gordon@spglobal.com

— Edited by Valarie Jackson, newsdesk@spglobal.com