Groups blast rumors EPA may slightly raise blending mandates

Source: By Marc Heller, E&E News reporter • Posted: Thursday, May 21, 2020

 Biofuel splashing. Photo credit: EPA

EPA may slightly increase 2021 renewable fuel standard blending requirements. EPA

A report that EPA may slightly raise the biofuel blending requirement under the renewable fuels program next year is sparking a new round of complaints from groups on either side of the issue.

According to a Reuters report citing unnamed sources, EPA has proposed increasing the amount of biofuel to be blended into the nation’s fuel supply from 20.09 billion gallons this year to 20.17 billion gallons next year.

The agency didn’t have a comment this morning on the proposal, which it sent to the White House Office of Management and Budget last week. Once it’s released, EPA will take public comment.

Always the focus of attention in the biofuel and petroleum industries, the proposal for next year is being especially closely watched because of legal wrangling over small refinery exemptions and the impact of the coronavirus pandemic, which has undermined demand for all liquid fuels.

Biofuel groups, which have seen production declines of as much as 50% during the crisis, are pushing for increases. Petroleum refiners, facing their own difficulties, say the mandate should be softened.

“There is no doubt that current circumstances with greatly suppressed demand for motor fuels necessitate substantial revisiting of the blending requirement,” the Fueling American Jobs Coalition said in a statement to E&E News. The coalition represents refineries, their unionized workers and others.

“In the last couple of weeks, six governors, seven state attorneys general, fifteen U.S. Senators, and twenty-five members of the House have all contacted the administrator with a unified voice on the topic,” the group said, noting that EPA is also weighing a second look at waivers it denied in past years. “It’s no surprise that EPA has remedial measures under serious consideration.”

Biofuel groups say the mandated volumes from EPA don’t carry as much weight if the agency is exempting many small refineries.

“If there is a lot of shoulder-shrugging about EPA’s proposal, it’s because these [renewable volume obligation] rules just don’t provide the certainty or send the important market signals that they used to,” said Geoff Cooper, CEO of the Renewable Fuels Association. “After the last few years of retroactive small refiner exemptions and other gimmicks, everyone is skeptical and nobody in the marketplace believes EPA’s proposal will show us the ‘real’ numbers.”

According to the Reuters report, EPA would maintain conventional biofuels at 15 billion gallons, a congressionally mandated level that’s been a focus of pressure from corn-state lawmakers and that President Trump has promised to uphold.