Growth Energy to Sue EPA on RFS Volumes

Growth Energy CEO Says Missed Deadline Adds to Uncertainty in Ethanol Industry

Todd Neeley
By  Todd Neeley , DTN Staff Reporter
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Growth Energy announced its intent to sue the Environmental Protection Agency for missing the Nov. 30 deadline for finalizing Renewable Fuel Standard volumes. (DTN file photo by Greg Horstmeier)

OMAHA (DTN) -- Growth Energy plans to file a lawsuit against EPA for missing the Nov. 30, 2020, statutory deadline to finalize 2021 Renewable Fuel Standard volumes.

In a letter to EPA Administrator Andrew Wheeler on Tuesday, Growth Energy general counsel Joseph Kakesh said the agency has 60 days to finalize the rule before a legal challenge is brought.

Effectively, the 60-day deadline means Wheeler can choose not to finalize volume standards for 2021, and turn the decision over to the first few days of President-elect Joe Biden's administration. Biden has yet to announce a nominee to head EPA in his administration.

On Monday, Renewable Fuels Association President and Chief Executive Officer Geoff Cooper suggested the Trump administration wait for a Biden administration to finalize the rule early in 2021.

In recent months Wheeler indicated the agency had more data points to consider in setting 2021 volumes, including falling fuel demand this year as a result of the COVID-19 economic shutdown.

"EPA has failed to perform this mandatory, non-discretionary duty," the letter said.

Growth Energy noted EPA has not issued the renewable fuel obligations for 2021 or even issued a notice of the proposed obligations for 2021. "Consequently, EPA appears likely to issue the obligations many months after the Nov. 30, 2020, deadline. Such extreme delay not only violates EPA's statutory duty, but also undermines the RFS program's purpose of 'forcing the market to create ways to produce and use greater and greater volumes of renewable fuel each year' and deprives market participants of the 'market certainty' that is 'so critical to the long-term success of the renewable fuel program.'"

Growth Energy Chief Executive Officer Emily Skor said in a statement the RFS volumes are important for ethanol producers who have faced a challenging year.

"Biofuel producers faced a difficult year in 2020, with fuel demand plummeting to 30-year lows at a historic rate," she said.

"At its lowest, over half the country's biofuel plants were forced to slow down or idle, and many have still been unable to come back online. As we head into a new year and our industry continues to try and recover from the effects of COVID-19, EPA's failure to meet their statutory obligation to issue RVOs (renewable volume obligations) piles on the uncertainty in the fuel marketplace. The agency needs to take action on behalf of rural America and follow through with its RFS obligation."

This was the first time the Trump administration missed the RFS deadline.

Several groups -- Growth Energy, Renewable Fuels Association, National Biodiesel Board, American Coalition for Ethanol, National Corn Growers Association, National Farmers Union, and National Sorghum Producers -- had asked a federal court to require EPA to set a "curative obligation" to make up for the 500 million lost ethanol gallons waived from the 2016 RFS.

In 2017, the U.S. Court of Appeals for the District of Columbia Circuit ruled the EPA had illegally waived the gallons from the 2016 Renewable Fuel Standard renewable volume obligations and required the agency to restore them, which the EPA has not yet done.

In the July 2017 ruling in Americans for Clean Energy v. EPA, the court invalidated the EPA's improper waiver of 500 million gallons in the 2016 RVO and ordered EPA to revisit the rule.

In its ruling, the court held EPA's interpretation of an inadequate-domestic-supply waiver provision "runs contrary to how the Renewable Fuel Program is supposed to work."

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Todd Neeley