WASHINGTON, April 10, 2015 - The Environmental Protection Agency (EPA) says it will issue its proposed Renewable Fuel Standard volume requirements for 2015 by June 1, and a final rule governing the volumes for 2014 and 2015 by Nov. 30.
The agreed-to-deadlines are part of a proposed settlement of a lawsuit filed in March by the American Petroleum Institute (API) and the American Fuel and Petrochemical Manufacturers (AFPM) over EPA delays in setting the requirements. Although not required by the consent decree, EPA said it will also finalize the standards for 2016 this year.
“This schedule is consistent with EPA's commitment to get the RFS program back on track, while providing certainty to renewable fuels markets and promoting the long-term growth of renewable fuels,” EPA said in a statement.
Both proponents and opponents of renewable fuels had expressed frustration over EPA delays in releasing required volume obligation (RVO) numbers under the RFS. The 2014 numbers, for example, still haven't been finalized four months into 2015. Under the statutory language of the RFS, RVOs are required to be announced by Nov. 30 of the preceding year. EPA had announced intentions to work on releasing RVOs for 2014, 2015, and 2016 all before the end of this year.
In court filings, the API and AFPM said confusion over final RVOs “curtails this market response and the ability of refineries to plan their production of various products.”
The EPA said the proposed consent decree does not address the content or substance of the volume standards, and it establishes the following schedule:
By June 1, the agency will propose volume requirements for 2015:
--By November 30, EPA will finalize volume requirements for 2014 and 2015 and resolve a pending waiver petition for 2014;
--EPA will propose and finalize the RFS standards for 2016 on the same timeline (proposal by June 1, final by November 30);
--EPA will propose and finalize the RFS biomass-based diesel volume requirement for 2017 on the same schedule;
--The agency will re-propose volume requirements for 2014 that reflect the volumes of renewable fuel that were actually used in 2014.
On a call with reporters Friday afternoon, Chris Grundler, director of the EPA’s Office of Transportation and Air Quality, said the agency has learned from the problems that caused previous delays and now knows that “missing a deadline is not an option.” He said EPA is working to get the RFS back to its statutory schedule, and the timeline in the consent decree was something very similar to what the EPA was already working toward.
“Our plan and our schedule was very similar to this,” Grundler said. “This is very close to what we had already been working against and now we’re just in a position to announce it.”
Biofuel industry officials responded favorably to the announcement. In separate statements, biofuel leaders said they were pleased to see some certainty added to the process.
“No one has benefited from the delays in setting annual renewable volume obligations; and while we are sympathetic to the difficulty EPA faces in promulgating annual targets, the statute is clear about the volumes required and the agency simply has to do a better job moving forward,” said Bob Dinneen, president and CEO of the Renewable Fuels Association. “The consent agreement is a good start.”
“Our producers have faced ambiguity for too long and today is welcome news that they are establishing a level of certainty with this announcement,” said Tom Buis, CEO of Growth Energy, which represents major ethanol producers. “However, far more important than timing is that that the EPA establishes a final rule that moves our industry forward, and reflects the bipartisan vision Congress intended for the RFS.”
Brooke Coleman, executive director of the Advanced Ethanol Council, said, “Now that we have a better idea of when it will happen, we look forward to working with EPA to make sure that the new RFS proposal supports the commercial deployment of advanced biofuels as called for by Congress.” He continued: “We were encouraged by EPA’s decision late last year to pull a problematic 2014 proposal, and we are optimistic that EPA will make the necessary adjustments and put the RFS back on track going forward.”
Anne Steckel, National Biodiesel Board vice president of federal affairs, said the group applauds the EPA for taking this step. “The RFS is the most successful policy we have for reducing emissions in the transportation sector, and it is working,” Steckel. She said NBB looks forward to working with the administration “to get this program back on track.”
Both Buis and Dinneen also said they were happy to see EPA announce intentions to set 2016 RVOs under the same timeline even though that was outside of the scope of the consent decree.
“By taking this action, they are ensuring that the RFS is back on a path to certainty for the biofuels industry, providing the necessary guidance for the industry to continue to thrive and advance alternative fuel options for American consumers,” Buis said.
API said the lack of certainty in the RFS left companies to guess how much ethanol they would be required to blend. In a statement, the organization said it hoped this consent decree would get the RFS back on schedule, but remained critical of the program.
“We hope this agreement helps get the RFS back on track, but the only long-term solution is for Congress to repeal the program and let consumers, not the federal government, choose the best fuel to put in their vehicles,” Linden said. “Failure to repeal the unworkable law could put millions of motorists at risk of higher fuel costs, damaged engines, and costly repairs.”
EPA said it will seek public comment on the terms of the proposed settlement for 30 days before deciding whether to proceed with the settlement. The proposed consent decree will be available in the public docket, and can also be found here.
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