Refiners to lobby for new RFS tweak

Source: By Mark Drajem, Bloomberg Government • Posted: Friday, June 10, 2016

No matter if it is Trump or Clinton, an overhaul of the Renewable Fuel Standard is possible,  Bloomberg Intelligence analyst Rob Barnett says. “Some Democrats have become disillusioned with the policy,” he writes. And Trump was “less enthusiastic” about ethanol while in North Dakota for his energy speech, he said. At EPA’s hearing in Kansas City yesterday about its proposed standards for 2017, industry will float one idea for reform. Refiner Valero, which is also the third-largest producer of ethanol in the U.S., will push EPA to shift the point of obligation for the requirement, according to a copy of its testimony. “Currently under the RFS, the obligation is set at the refinery gate, while the mechanism to achieve compliance is at the point of blending at the rack,” Matthew Hodges from the company is set to testify. This disconnect harms independent refiners, small retailers and renewable fuel producers, Valero says. Changing the obligation would provide broader incenctives to invest in blending infrastructure, and lead to more sales of higher blended fuels, Hodges will argue.

Also on tap to speak in favor of ethanol: Nebraska Gov. Pete Ricketts and Richard Fordyce, director of agriculture in Missouri. Ethanol producers are likely to argue EPA erred in cutting the requirements below the statutory levels, and that growing fuel demand makes those targets achievable.