EPA releases final rule that angers ethanol, farm boosters

Source: By Marc Heller, E&E News reporter • Posted: Thursday, December 19, 2019

The Trump administration is sticking with a biofuel policy for next year that has sparked criticism from the ethanol industry and farm groups.

In a final rule, EPA said it will continue to grant waivers of biofuel-blending requirements to small refineries in certain situations and will reallocate at least some of the waived gallons to other refiners.

But in a move that has drawn opposition from the industry, officials said they’ll base the reallocations on projected volumes rather than the actual waivers granted.

That aspect of the RFS is part of EPA’s annual announcement of the amount of biofuel to be mixed into the nation’s fuel supply. Conventional ethanol, made mainly from corn, will be maintained at 15 billion gallons next year, officials told reporters, while the volume of cellulosic ethanol will climb by about 170 million gallons compared with this year.

“Through President Trump’s leadership, this administration continues to promote domestic ethanol and biodiesel production, supporting our nation’s farmers and providing greater energy security,” said EPA Administrator Andrew Wheeler in a news release. “President Trump committed to our nation’s farmers that biofuel requirements would be expanded in 2020. At the EPA we are delivering on that promise and ensuring a net of 15 billion gallons of conventional biofuel are blended into the nation’s fuel supply.”

The Renewable Fuels Association said the proposal, in practice, means the requirement of 15 billion gallons might not be met on account of small refinery exemptions.

“EPA’s rule fails to deliver on President Trump’s commitment to restore integrity to the RFS, and it fails to provide the market certainty desperately needed by ethanol producers, farmers, and consumers looking for lower-cost, cleaner fuel options,” said RFA President and CEO Geoff Cooper in a news release.

After the controversial granting of exemptions during the Trump administration, Cooper said that “agency officials had a chance to finally make things right with this final rule — but they blew it.”

EPA officials told reporters in a conference call today that they would base the reallocated volumes on the Department of Energy’s small refinery waiver recommendations from 2016 to 2018. That includes DOE recommendations for partial exemptions, which EPA hasn’t granted in the past, and would have accounted for around 770 million renewable fuel credits, officials said. A renewable fuel credit, or Renewable Identification Number, is equivalent to 1 gallon of biofuel.

House Agriculture Chairman Collin Peterson (D-Minn.) said EPA’s decision lets farmers down.

“The Administration has repeatedly directed the EPA and other agencies to support the ethanol industry and corn farmers, and the EPA has told those farmers to trust them,” Peterson said. “Instead we’re seeing a final rule out of EPA that doesn’t guarantee the 15 billion gallons the RFS mandates.”