Recent court arguments about biofuels policy underscored a battle often fought in courtrooms: weighing semantics against substance.
The most recent iteration of the fight came Friday in Growth Energy v. EPA, a case filed in February 2019 over the biofuel blending targets set for that year in late 2018. Then, EPA opted not to reallocate gallons waived through small refinery exemptions given to facilities who claim complying with the Renewable Fuel Standard would cause them undue economic harm.
But at Friday’s arguments, SREs were hardly mentioned, taking a back seat to whether or not the District of Columbia Circuit Court of Appeals could even hear the case because of questions over whether the challenge was timely. An attorney arguing for Growth Energy said the case was proper because it was filed within the time frame of EPA’s decision, but a Department of Justice attorney said that wasn’t the case because it was based on EPA rationale dating back to 2011.
Emily Skor, Growth Energy
On a call with reporters after the arguments, Growth Energy officials also pointed to another court case that called on EPA to reallocate waived gallons in future blending targets, something that hasn’t happened.
“It’s incredibly frustrating,” Growth Energy CEO Emily Skor told reporters. “For us, we have a very clear-cut court decision, and EPA’s failure to respond to that decision, and then the recourse is what? Additional litigation? Additional legal action and/or that we should have to exercise political pressure to get the agency to follow a court decision? That’s incredibly frustrating and it shouldn’t be the case.”
While this case may be bogged down in a debate over timeliness, the biofuels sector has had success in recent challenges. Earlier this year, the 10th Circuit Court of Appeals struck down three specific SREs but offered a new rationale — that waivers needed to be issued consecutively — for the agency to consider as it debated new waivers. That case — brought by the Renewable Fuels Association, National Corn Growers Association, American Coalition for Ethanol, and the National Farmers Union — led small refineries to push for “gap year” SREs, which EPA recently denied en masse.
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But there’s still the matter of the gallons already waived, something Growth Energy General Counsel Joe Kakesh said was part of the organization’s three-pronged legal strategy: challenging the actual exemptions, challenging the failure to make up for lost renewable identification numbers — the credits that track RFS compliance — and a challenge to the procedure used to issues SREs.
The case before the court last week dealt with the question of lost RINs, and Kakesh said he was optimistic
“We may see the court get to the merits, nonetheless, and I’m hoping they do,” he said. “The jurisdictional question about timeliness is the first question the court has to address.”
DOJ and the American Fuel and Petrochemical Manufacturers both argued before the court, as well, pushing back against Growth’s assertions that waived gallons needed to be included in the RVO.
While the three-judge panel that heard the arguments didn’t offer much in the way of indications about how they might decide the case, Growth Energy officials and the attorney had a request: If you side with us, please do so emphatically.
“The court needs to send a signal to the agency that its orders need to be taken seriously,” Kakesh told reporters.
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