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11th Circuit Rules Against Hunt Refining in Ruling on Small-Refinery Exemptions

Todd Neeley
By  Todd Neeley , DTN Environmental Editor
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The U.S. Court of Appeals for the 11th Circuit on Thursday issued a ruling in small-refinery exemptions case. (DTN file photo)

LINCOLN, Neb. (DTN) -- A federal appeals court on Thursday dismissed one of many legal challenges to EPA's rejection of small-refinery exemptions to the Renewable Fuel Standard, ruling that Hunt Refining Company filed the petition in the wrong court.

The U.S. Court of Appeals for the 11th Circuit in Atlanta, Georgia, said in its ruling the appeal should have been filed in the U.S. Court of Appeals for the District of Columbia Circuit.

In June 2022, the Biden administration rejected 69 pending small-refinery exemption requests including Hunt's. That included petitions filed for compliance years 2019 to 2021.

EPA argued in court the company should have filed the petitions in the D.C. Circuit because the challenged denials were either "nationally applicable" or were based on a determination of "nationwide scope or effect."

The court determined the denials did have some national effect.

"First, the nationwide scope of the actions, which denied 105 petitions from refineries across the country, is a 'strong indicator' of their national applicability," the court said.

"Second, and more importantly, the EPA denied the hardship exemption petitions based on a new statutory interpretation and analytical framework that is applicable to all small refineries no matter their location or market."

Refining companies across the country have filed numerous challenges to the EPA denials,….

In briefs filed with the 11th Circuit, Hunt tried to make a case that the court was the proper venue.

"Hunt insists that the denial actions were locally applicable because, according to Hunt, (the statute) requires that small-refinery hardship decisions be based on individualized assessments of refinery-specific circumstances," the court said in its ruling.

"The problem with that argument is that as Hunt acknowledges, the EPA did not base its denials on refinery-specific circumstances. In fact, Hunt complains in its brief to us that the EPA violated the CAA by not making individualized determinations and by ignoring refinery-specific evidence. It appears to us that in the denial actions the EPA did review the refineries' individual and market-specific evidence, but it determined that evidence did not affect its overall economic analysis or conclusions about the costs of RFS compliance."

Growth Energy CEO Emily Skor said the court's ruling helps to maintain consistency in how courts approach similar cases.

"The 11th Circuit validated what we already knew: EPA's denials of these SRE petitions were 'nationally applicable' and have nationwide effect, and challenges to the denials should only have been brought in the D.C. Circuit," she said in a statement.

"Every time refiners seek to take RFS gallons out of the marketplace, that potentially impacts the entire renewable fuels market, no matter where those gallons are blended. The 11th Circuit rightly removed itself from reviewing these challenges and avoided contributing to a potential patchwork of inconsistent standards."

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