House climate bill would uncover refinery waivers

Source: By Marc Heller, E&E News reporter • Posted: Thursday, March 4, 2021

The biofuel industry claimed a big win from climate legislation introduced by House Democrats, after the bill’s writers included language to reveal which companies EPA allows to skirt biofuel-blending requirements.

The “CLEAN Future Act,” proposed by Chairman Frank Pallone (D-N.J.) and other Democrats on the Energy and Commerce Committee, would end EPA’s practice of withholding names of companies that receive small-refinery exemptions under the renewable fuel standard.

Secrecy behind the exemptions — which grew dramatically in number during the Trump administration — has been a major sore point for the ethanol industry, which complains that some of the biggest, thriving petroleum companies have been able to receive them.

The waivers are reserved for refineries that would face economic harm if forced to comply with RFS requirements, but a struggling refinery that’s part of a company with big profits could conceivably fit the definition.

The climate bill contains other language promoting biofuel interests, including setting June 1 each year as a deadline for refineries to submit waiver petitions, which groups say would allow EPA to account for them in setting annual biofuel-blending requirements.

The bill’s authors included the text of a measure called the “RFS Integrity Act,” by Reps. Angie Craig (D-Minn.) and Dusty Johnson (R-S.D.), which includes the small refinery language. The legislation also includes a requirement that EPA disclose the number of gallons of biofuel exempted for refineries requesting waivers.

“The inclusion of biofuels in the CLEAN Future Act is a nod to their effectiveness in our country’s climate efforts and their critical role in decarbonizing the transportation sector,” said Emily Skor, CEO of Growth Energy, in a statement.

Biofuels’ inclusion reflects that industry’s position that ethanol, biodiesel and similar products are an environmentally friendly alternative to petroleum and deserve to play a big role in reducing carbon emissions.

But plenty of critics take a different view, warning that biofuel production involves its own environmental risks such as converting land from grasses to a more intensive crop like corn that requires fertilizer and pesticides.

The petroleum industry has fought to protect RFS exemptions and says companies shouldn’t have to reveal confidential business information when they apply for them. In some cases, petroleum industry groups say, the cost of renewable fuel credits to meet RFS mandates is a top expense at a refinery, rivaling labor.

The industry continues to oppose further requirements for transparency in the small refinery waivers, in light of recent decisions at EPA to report regularly on how many waivers are requested, granted and denied annually, said the American Fuel and Petrochemical Manufacturers, an industry group. The agency updates the information on its website regularly.

“EPA has already appropriately enhanced its process to be transparent about the number of small refinery relief petitions it receives. AFPM opposes provisions intended to chill companies seeking needed regulatory relief,” said Geoff Moody, AFPM vice president of government relations, in a statement to E&E News.

The climate bill also includes a provision requiring EPA to act on petitions for new “pathways” under the RFS — such as new uses for biofuel feedstocks — if 90 days or more have passed since a related petition was submitted to the agency.

In other biofuel developments, lawmakers introduced bills yesterday to expand access to higher-ethanol blends and to direct EPA to update its greenhouse gas modeling on ethanol and biodiesel.

The higher-blend bill, by Reps. Cindy Axne (D-Iowa) and Rodney Davis (R-Ill.), is called the “Renewable Fuels Infrastructure Investment and Market Expansion Act.” The greenhouse gas modeling bill, by Johnson, is called the “Adopt GREET Act.”

The higher-blends bill is a companion to Senate legislation, S. 227, by Sens. Amy Klobuchar (D-Minn.) and Joni Ernst (R-Iowa).

The House “Adopt GREET Act” is a companion to a bill, S. 193, by Sens. John Thune (R-S.D.) and Klobuchar.