Trump EPA Pick Says Backs Biofuels Program, but Open to Tweaks

Source: By Valerie Volcovici and Timothy Gardner, Reuters • Posted: Thursday, January 19, 2017

WASHINGTON — Oklahoma Attorney General Scott Pruitt, President-elect Donald Trump’s choice to lead the Environmental Protection Agency, said on Wednesday he would honor the intent of the U.S. biofuels program, but remained open to tweaking it.

The Renewable Fuel Standard requires the EPA set annual quotas for the use of ethanol and biodiesel in transportation fuels. More than a decade old, the standard is fiercely defended by the U.S. corn industry that provides most of the ethanol, but it has been a source of frustration for oil refiners. They say the goals are unrealistic without an overhaul in automobiles and infrastructure, and are calling for changes.

Pruitt said during his confirmation hearing on Wednesday that he was committed to Congress’ plan, laid out in 2007, to annually increase the amount of ethanol and other renewables blended with petroleum fuels. He said the waivers that EPA has already used to set requirements below those targets to accommodate market conditions should be used “judiciously”.

He explained his view that the EPA should not use those waivers to “undermine commitments” from Congress but that they are needed in some cases, including when there is lower-than-expected fuel demand.

The comments quelled some concerns from within the industry over the nominee, who as Oklahoma’s attorney general had described the program as “flawed” and “unworkable.”

Renewable Fuels Association Chief Executive Officer and President Bob Dinneen described Pruitt’s comments as “heartening” in a statement.

While generally supportive of program, Pruitt said it was too soon to say whether it needed to be altered.

Oil refiners including HollyFrontier Corp and Delta Air Lines Inc’s Monroe Energy have requested that the responsibility of blending renewables like ethanol into their fuel be shifted from them to companies further down the supply chain.

The EPA moved to deny the request, but is seeking public comment on the decision.

When asked about the idea, Pruitt said he did not want to “pre-judge” the outcome of the comment period.

Trump has separately tapped billionaire and RFS critic Carl Icahn as a special advisor on regulations, raising industry speculation that the incoming administration will be more likely to consider the change.

Pruitt is one of several of Trump’s senior Cabinet picks to face Senate hearings since last week.

(Reporting by Valerie Volcovici and Timothy Gardner in Washington and Chris Prentice in New York; editing by Richard Valdmanis and David Gregorio)