Oil-state Republicans urge EPA to waive 2020 RFS

Source: By Inside EPA • Posted: Wednesday, August 25, 2021

A group of 17 Republican senators from oil-producing and refining states is pressing EPA to waive its renewable fuel standard (RFS) for 2020, and to reduce biofuel blending obligations for refineries in its forthcoming proposed volumes rules for 2021 and 2022, as the agency nears proposal of those rules.

In their Aug. 23 letter to EPA Administrator Michael Regan, the group led by Sens. Pat Toomey (R-PA) and Shelley Moore Capito (R-WV) say, “In light of COVID-19’s impact on the demand for refined product and the burden of RFS compliance, we urge you to waive or significantly reduce the renewable volume obligation (RVO) for compliance year 2020, and set the 2021 and 2022 RVOs at levels that comport with reality.”

The senators ask that the 2021 and 2022 blend levels be set below the “blend wall,” or the point at which oil sector groups say no more biofuel can be blended into the fuel supply because of vehicle and infrastructure constraints.

They further say that the price of RFS compliance credits, or renewable identification numbers (RINs), has “soared” to over $2 “for the first time since the enactment of the RFS,” which was established in its current form in 2007.

Insufficient “carryover RINs” are available in the RIN “bank” to satisfy demand, “leaving U.S. refiners little choice but to cut fuel production, increase fuel exports, or face non-compliance with the RFS. All of these outcomes would harm U.S. consumers, threaten union jobs, and curtail the ongoing economic expansion,” the senators write.

The intervention comes as EPA is preparing to send its overdue proposed 2021 RVO to the White House Office of Management and Budget (OMB) for pre-publication review, a rule that is expected to reduce the RFS biofuel blending requirement, according to news reports.

The reports suggest EPA may reduce the biofuel blending volumes for 2021 relative to those for 2020 to reflect reduced overall fuel use during the pandemic.

But EPA is also expected to issue an RVO for 2022 that may be higher than the 2021 volume.

EPA by law should have finalized the rule for 2021 by Nov. 30, 2020, but given the lack of even a proposal to date, the agency will be hard-pressed to issue the final regulation even a year late.

Biofuels groups were swift to condemn the GOP senators’ letter. Renewable Fuels Association President and CEO Geoff Cooper said it “should come as no surprise to anyone that Senators Cruz, Cornyn, Inhofe, Barrasso and their Republican anti-ethanol colleagues are circling the wagons to protect the status quo for Big Oil and continuing their efforts to undermine cleaner, greener renewable fuels.”

Cooper added, “Asking EPA to waive the 2020 RFS standards — which were finalized by the previous administration in 2019 — is a fool’s errand; EPA has repeatedly stated that it does not have the authority to go back in time and change RFS volumes that have already been finalized. And the Biden administration knows that reducing the 2021 and 2022 RFS volumes would derail the President’s agenda related to clean energy, climate, and domestic manufacturing jobs. It would also mark a big step backward on the path to net zero GHG emissions by 2050.”