The Environmental Protection Agency on Thursday disclosed five more small refinery exemptions from the federal biofuel mandates, adding to a climbing volume of waivers that companies are getting.
The news came through an update to EPA’s SRE dashboard, which showed 34 SRE requests have been granted, accounting for nearly all of the 37 applications the agency has received. Another two requests are still pending, and one request is listed as “declared ineligible or withdrawn.”
The waivers exempt small facilities — those producing less than 75,000 gallons of fuel per day — from the requirements of the Renewable Fuel Standard. Approved SREs have skyrocketed under the Trump administration, something the biofuels industry blames on former administrator Scott Pruitt. The agency attributes the increase to volatility in the Renewable Identification Number market and previous court cases mandating the EPA be less stingy with how it awards the exemptions.
In a statement, an EPA spokesman said the agency was continuing to “implement the Renewable Fuel Standard program in accordance with the Clean Air Act, taking into consideration additional direction from Congress, recommendations from Department of Energy, and relevant court decisions.”
In keeping with previously established practices on the waivers, the disclosure did not include information on companies receiving an SRE. The agency spokesman said many aspects of the qualification process involve confidential business information.
According to EPA, 1.82 billion RINs have been exempted from the 2017 RFS compliance year.
The biofuels industry reacted to the news with a mixture of disappointment and anger.
Renewable Fuels Association President and CEO Geoff Cooper called the news “extremely disappointing and outrageous.”
“The RFS was created to preserve the environment, protect America's energy security and give Americans more affordable options at the pump,” he said. “These exemptions undercut those goals.”
Brian Jennings, CEO of the American Coalition for Ethanol, said the exemptions undercut EPA’s efforts to allow year-round E15 sales.
"Any benefit of selling E15 year-round will be wiped out until and unless EPA gets back to the rule of law when it comes to these refinery waivers under the Renewable Fuel Standard,” Jennings said.
Growth Energy CEO Emily Skor called the decision "a slap in the face to rural communities."
"EPA continues to hand out exemptions to unidentified refiners, which only strengthens our serious concern that EPA continues to enrich some of the most profitable oil refineries in the world, all in secret."
In their statements, Jennings, Cooper, and Skor all referenced ongoing legal action against EPA’s use of the waivers.
Kurt Kovarik, vice president of federal affairs for the National Biodiesel Board, criticized EPA Administrator Andrew Wheeler for continuing the practice of issuing the exemptions.
“EPA Administrator Andrew Wheeler is unfortunately following in the footsteps of Scott Pruitt, undercutting demand for biodiesel and renewable diesel by handing out retroactive small refinery exemptions to every refinery that asks for one," he said. "It appears to be business-as-usual at EPA, with no effort to ensure that renewable volume obligations are made whole following the exemptions. America’s farmers, biofuel producers, and the environment are directly harmed."
Energy sector lobbyist Scott Segal defended the waivers, saying EPA was legally required to implement them.
"To say that the current administration undertook any special treatment for refiners is completely inconsistent with law and precedent. It’s just sour grapes from some in the biofuels sector," he said. "RFS small refiner exemptions are designed to stave off the impacts of inequitable treatment arising from the program’s implementation. Multiple courts have ruled that even attempts by EPA to insert too high a bar to granting SREs is not consistent with the underlying law and policy of the Clean Air Act."
The EPA SRE dashboard also disclosed 39 waiver requests for the 2018 compliance year. All of those petitions are currently pending before the agency.
(Story updated to include additional comment.)
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