Industry group wants documents on EPA refiner exemptions

Source: Marc Heller, E&E News reporter • Posted: Friday, April 6, 2018

A leading advocacy group for biofuels is demanding greater openness from U.S. EPA and the Department of Energy about the Trump administration’s decision to ease the federal ethanol blending mandate for more than two dozen refineries.

The Renewable Fuels Association said it’s filing Freedom of Information requests with the two agencies in an effort to find out more about the renewable fuel standard waivers, which EPA grants in secret but which have been reported by news outlets this week.

The association, representing biofuel companies, called EPA’s actions “underhanded” and accused the agency of a “cloak-and-dagger” decisionmaking process for the waivers.

Waivers are allowed under the RFS for small refiners that can demonstrate economic hardship from complying with the fuel blending requirement, and EPA grants them in consultation with DOE. Refiners can also meet the mandate by buying renewable fuel credits called renewable identification numbers, or RINs.

“Make no mistake, EPA’s underhanded refinery waivers are negatively affecting the welfare of our nation’s ethanol producers and the very livelihood of America’s family farms,” said RFA President and CEO Bob Dinneen in a statement.

In a statement today, EPA spokeswoman Liz Bowman said the agency is following the same rules it always has for the waivers.

“The criteria used to grant waivers has not changed since previous administrations,” Bowman said. “EPA follows a long-standing, established process where the Agency uses a DOE analysis to inform decisions about refiner exemptions/waivers. These waivers are only considered for refineries that submit applications and that are below the blending threshold.”

The association’s statement suggested the flood of waivers wasn’t a surprise. In January, the group wrote to EPA, asking for information such as the total number of RFS waivers pending for 2018 and whether the agency intended to disclose the number granted in 2016, 2017 and subsequent years.

EPA doesn’t reveal which refineries receive waivers, citing the possibility that that would reveal private business information. But the agency confirmed today it has granted “roughly 25” so far, and said it doesn’t have specific information on the refining capacity of the affected plants.

While the waivers are intended for small refineries, one recent grantee, Andeavor, is among the nation’s biggest refiners and reported more than $1 billion in annual profits. The agency granted waivers to three of Andeavor’s smallest refineries, according to a Reuters news report.

The agency hasn’t answered the RFA’s earlier inquiry, the association said.

Refining industry sources say the increasing number of waivers reveals the RFS’s shortcomings and an economic burden it puts on companies.

EPA’s leniency toward some refineries is the Trump administration’s latest signal that its support of the renewable fuel mandate has limits. EPA agreed to ease the requirements for Philadelphia Energy Solutions Inc., the biggest refinery on the East Coast, after the company cited RFS costs in its bankruptcy filing last year.

And while President Trump has repeatedly said he supports the ethanol industry and the fuel standard, EPA Administrator Scott Pruitt has said he agrees with refiners that officials should consider ways to rein in the cost of renewable fuel credits (E&E News PM, Dec. 7, 2017).

Pruitt has been meeting from time to time with industry representatives and lawmakers on RFS issues. He said in an interview with the Washington Times yesterday that another meeting is scheduled for Monday.