Iowa lawmakers press Wheeler for visit

Source: Marc Heller, E&E News reporter • Posted: Wednesday, July 18, 2018

Iowa’s congressional delegation invited acting EPA Administrator Andrew Wheeler to the state, urging the agency to take a friendlier stance on ethanol mandates.

“It is our expectation you will reinforce the Renewable Fuel Standard and bolster our nation’s energy security,” the six lawmakers told Wheeler in a letter Monday.

Reps. David Young, Rod Blum and Steve King, all Republicans, and Dave Loebsack, a Democrat, signed the letter, along with Republican Sens. Chuck Grassley and Joni Ernst.

In their letter, the lawmakers repeated their complaints that economic “hardship” waivers EPA has granted to an increasing number of small refiners have cut into demand for biofuels. They asked Wheeler to reconsider the agency’s recent decision not to make up for the waived biofuel volumes through the proposed biofuel levels for 2019.

The waivers allow small refiners to temporarily avoid the biofuel blending requirements, such as buying renewable fuel credits.

They also pressed Wheeler, who was deputy administrator from April until earlier this month, to move quickly on allowing sales of higher ethanol fuel year-round. Regulations currently block sales of E-15 — which is 15 percent ethanol — in the summer due to fuel volatility measures.

President Trump said earlier this year that the administration would lift the restrictions on E-15. Former Administrator Scott Pruitt had said EPA lawyers were looking into how to do so legally (Greenwire, April 12).

At his confirmation hearing last year for deputy administrator, Wheeler said the RFS is the law and added, “I fully support the program.” Lawmakers cited the quote in their letter.

Wheeler has a background in ethanol, having consulted for the industry group Growth Energy. He also lobbied for the coal industry.

The lawmakers’ letter comes as EPA prepares for a public hearing today on the proposed 2019 biofuel levels under the renewable fuel standard. Grassley has said the agency’s proposal to meet the congressionally mandated level of 15 billion gallons of conventional biofuel can’t be taken seriously if EPA continues to grant waivers.

Petroleum industry groups say the hardship waivers aren’t fully at EPA’s discretion, citing the law’s requirement that waivers be granted when small refiners demonstrate that their costs of compliance are significantly greater than the industry average.

The Obama administration denied refiners’ requests for waivers and was rebuffed in federal court, which petroleum groups say led to the waivers’ being granted under Pruitt.

When waivers were denied, small refiners felt the economic pain of buying increasingly costly renewable fuel credits, according to the Small Refiners Coalition, an industry group.

“As a result, several small refineries were divested and sold to larger oil companies,” the group said in a statement responding to recent criticism of RFS waivers.

It added that others were forced to cut capital investments needed to remain competitive, froze employee compensation and benefits, implemented hiring freezes and laid off workers. This was all done in order to pour cash into the “wildly volatile, speculative and fraudulent market” for RFS credits, the group said.