Wheeler points to ‘a number of issues’ with gap year SREs

Source: By Spencer Chase, Agri-pulse • Posted: Sunday, July 5, 2020

EPA Administrator Andrew Wheeler says there are a handful of unanswered questions in the effort by small refineries looking to secure relief from past blending requirements of the nation’s biofuel mandate.

Speaking to reporters Wednesday, Wheeler said the waivers – which are typically awarded within a year of the compliance period – bring into question how to offer relief the refineries are seeking.

“Some of these petitions go back to 2012, (Renewable Identification Numbers) from that year are no longer active; they’ve expired,” he said. “So there’s questions about whether or not they can show economic harm and what the remedy would be.”

The waivers – dubbed Small Refinery Exemptions and awarded to facilities that say complying with the Renewable Fuel Standard would cause them economic damage – have been a hot-button issue for several years after their use exploded following a court decision and the appointment of former EPA Administrator Scott Pruitt. The practice of awarding the waivers has continued under Wheeler’s tenure, something the agency has defended as complying with that decision, which said the Obama administration was being too stingy in granting SREs.

But earlier this year, the 10th Circuit Court of Appeals found that the waivers must be issued on a continuous basis and cannot be extended after earlier, temporary exemptions have lapsed. In response, small refineries have applied for “gap year” SREs in recent months, a move that could simultaneously infuriate biofuel stakeholders and allow for the continued issuance of SREs.

The waivers have also forced EPA to continue operating without a deputy administrator. Last week, Sen. Joni Ernst, an Iowa Republican and one of the most vocal supporters of biofuels on Capitol Hill, said she would not support advancing the nomination of Doug Benevento as EPA’s deputy administrator out of the Senate Environment and Public Works Committee “until EPA tells us exactly what they plan to do with the ‘gap year’ waivers.”

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On Wednesday, Sen. Ted Cruz, R-Texas, issued a hold threat of his own, saying he will not allow Benevento’s nomination to move forward “until Administrator Wheeler delivers on his promise to take actions that help bring stability to the price of RINs.” Unlike Ernst, Cruz does not serve on EPW, but could still prevent his nomination from being approved by unanimous consent on the Senate floor.

The agency is currently considering more than 50 petitions for relief; Wheeler said EPA has not yet received recommendations on the waivers from the Department of Energy, which reviews the requests as the first step in the SRE application process.

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