The Environmental Protection Agency is asking the U.S. Court of Appeals for the District of Columbia to return the Trump administration’s 2019 decision to grant 31 small refinery exemptions for compliance year 2018, to the agency for review.
The move comes after the Supreme Court struck down a 10th Circuit Court of Appeals ruling that said small refinery exemptions must be granted consecutively. In a 6-3 decision, the court noted SREs from Renewable Fuel Standard blending requirements do not need to be extended continuously.
SREs are issued to refiners with production capacity of less than 75,000 barrels per day who claim RFS compliance would cause them undue economic harm.
In a motion to the D.C. Circuit last week regarding a case involving 36 SRE petitions (five were denied), EPA said a “voluntary remand will allow the opportunity to reconsider its decision in light of intervening judicial decisions and to provide a more robust explanation of its actions after reconsideration.” The news was first reported by DTN.
The agency said the remand could help it further review “what, if any, impact the remaining holdings in the 10th Circuit's decision may have on EPA's implementation of the small-refinery exemption provision generally” and on the small-refinery petitions considered in following the Supreme Court's decision.
EPA said it plans to consider “what, if any, resulting impact that may have on the small-refinery petitions adjudicated in the decision and challenged here,” the motion asserted.
“While EPA acknowledges that the Tenth Circuit’s alternative holdings are not binding authority on this court’s review of the nationally-applicable Decision, EPA is now faced with the complicated task of considering its approach to small refineries nationwide going forward, and many small refineries are located within the jurisdiction of the Tenth Circuit,” the agency said.
EPA’s request comes a few days after the 10th Circuit Court of Appeals declined to clarify its instructions to the agency following the Supreme Court decision. The 10th Circuit vacated its previous decision in July.
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EPA said it would proceed to review the three SREs at issue in that case in light of “alternate holdings” in the 10th Circuit’s Jan. 24, 2020, opinion that were not addressed by the Supreme Court. In the meantime, the three SREs will remain in effect. HollyFrontier and Wynnewood Refining had opposed EPA’s request for clarification.
In the D.C. case, the Renewable Fuels Association, Growth Energy, National Biodiesel Board, National Farmers Union, National Corn Growers Association, and American Coalition for Ethanol want the 2019 decision remanded and vacated. But EPA argued the decision should not be vacated because it would be “disruptive” to all parties involved.
According to EPA’s dashboard, it still must consider 59 pending exemptions for compliance years 2016-2021. Nearly 4 billion renewable fuel gallons have been exempt since 2016.
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