Walz, Noem ask Trump to tap the brakes on small refinery waivers

Source: By: Dana Ferguson, DL Online • Posted: Thursday, September 5, 2019

The governors noted an uptick in waivers for oil refineries, which have depressed the need for billions of gallons of ethanol.

South Dakota Gov. Kristi Noem, at left, and Minnesota Gov. Tim Walz, at right.

Gov. Tim Walz, a Minnesota Democrat, and Kristi Noem, a South Dakota Republican, in their letter raised their concerns about the growing number of waivers under the Renewable Fuel Standard granted since 2016. Walz and Noem are the chair and vice-chair of the Governors’ Biofuels Coalition.

The Renewable Fuel Standard dictates the volume of renewable fuels that needs to be blended into the U.S. transportation fuel supply each year. And it can provide an additional market for farmers.

The Trump administration greenlighted 85 exemption waivers for oil refineries since 2016. That figure includes 31 hardship exemptions granted last month. The move dropped the volume of renewable fuels blended into U.S. supply by roughly 4.04 billion gallons.

By contrast, the Obama administration allowed 23 exemptions over three years, representing 690 million gallons.

And in the months since granting the waivers to oil refineries, renewable fuel plants have slowed production or closed. Corn Plus, an ethanol plant in Winnebago, Minn., announced last week that it would close its doors. And POET has announced it will idle processing at biorefineries across the Midwest following the issuance of the “oil bailouts.” Company officials in a news release said the idling will result in job consolidations.

“Every waiver EPA approved affects our states,” Walz and Noem wrote. “The recent approval of 31 additional small refinery waivers undermines the integrity of the RFS and harms our states’ agricultural communities, which have already been affected by the Administration’s tariffs.”

Both Noem and Walz said they’d work with the president to find solutions. And they encouraged Trump to consider as part of upcoming plan adjustments to octane standards, new partnerships with the U.S. Department of Agriculture and update in next year’s Renewable Volume Obligations that would include hundreds of millions of gallons lost this year.