EPA to file motion taking back 2011 cellulosic decision

Source: Amanda Peterka, E&E reporter • Posted: Thursday, March 14, 2013

U.S. EPA is expected to tell a federal court soon whether it will voluntarily take back a decision to uphold its 2011 cellulosic biofuel requirement, a move that would represent a win for several oil groups that have brought lawsuits over the matter.

Last week, three oil trade groups asked the U.S. Court of Appeals for the District of Columbia Circuit to stay the case pending a voluntary remand by EPA of the challenged decisions. The agency could file a motion as early as today, sources close to the litigation said.

At issue is EPA’s 2011 cellulosic biofuel target that it put in place under the renewable fuel standard. In 2011, EPA mandated that refiners blend 6.6 million gallons of cellulosic biofuel into the nation’s gasoline supply, though the agency did not record any of the fuel actually being produced in the country.

Cellulosic biofuel refers to next-generation fuel made from plant-based materials like agricultural residue, switchgrass and municipal solid waste.

In lawsuits, the American Petroleum Institute, American Fuel & Petrochemical Manufacturers and the Western States Petroleum Association took issue with both the 2011 target itself and a decision by the agency last spring to deny petitions challenging the requirement. The groups have long argued that the number was unrealistic and forced refiners to pay to not use fuel that doesn’t yet exist in the market.

The court last year dismissed the first part of API’s case against the target, finding that the petition for review was filed well beyond the 60-day deadline for judicial review of an agency’s action (Greenwire, Dec. 18, 2012).

The same court also last year struck down EPA’s 2012 cellulosic requirement, finding that it wasn’t accurate enough, and in late February EPA decided to zero out that target in response (Greenwire, Feb. 28). Oil industry groups are rumored to be considering a lawsuit against the agency’s 2013 target as well.

As the issue continues to be a headache for EPA in court, cellulosic producers celebrated a win yesterday as the company ZeaChem Inc. switched on a 250,000-gallon-a-year biorefinery in Boardman, Ore. The demonstration plant will convert woody biomass and agricultural residues into both cellulosic ethanol and intermediate chemicals like acetic acid and ethyl acetate.

ZeaChem has partnered with local tree farm GreenWood Resources, Valero Energy Corp. and Chrysler Group LLC to build its first commercial-scale plant in Boardman adjacent to the demonstration facility. When completed, the plant is expected to produce 25 million gallons per year of ethanol and chemicals.

“The production of cellulosic ethanol from ZeaChem’s biorefinery in Oregon demonstrates the significant progress being made by the advanced ethanol industry,” said Brooke Coleman, executive director of the Advanced Ethanol Council. “Jobs are being created, capital is being spent and production is coming online.”