Ethanol Blog

Small Refinery Waiver Requests to EPA Reach 37, Same as Last Year

Todd Neeley
By  Todd Neeley , DTN Staff Reporter
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The EPA has received the same number of small refinery waiver requests this year as it did last year. (Photo by Greg Horstmeier)

Although the price of renewable identification numbers, or RINs, are much lower at this point, a Feb. 10 EPA update to its so-called RINs dashboard shows the agency has received the exact same number of requests for small refinery waivers as it did one year ago.

The number of companies requesting the waivers to the Renewable Fuel Standard increased from 22 as of December, to 37 in February. According to the EPA website, however, the agency has not granted a single waiver requested for 2018. For the 2017 RFS compliance year the EPA received 37 requests and granted 29.

EPA Acting Administrator Andrew Wheeler has indicated the agency is bound by a series of court decisions to consider every waiver request. Agriculture and ethanol interests are holding out hope that Wheeler's EPA will not be as lenient in granting waivers.

The EPA granted a total of 49 such waivers for 2016 and 2017 renewable volume obligations. The EPA said in its latest RFS volumes proposal that it waived a total of 2.25 billion gallons those years. EPA has taken heat for granting waivers to the likes of highly profitable, large oil companies such as Chevron and Exxon.

Refineries producing transportation fuel are required by the RFS to demonstrate each year that they have blended certain volumes of renewable fuel into gasoline or diesel fuel, or acquired biofuels credits from others called renewable identification numbers, or RINs.

The RFS allows certain small refineries -- those that produce 75,000 barrels or less per day -- to petition EPA for a temporary extension of an exemption.

To date, EPA has yet to make public details regarding how it determines who qualifies for small refinery exemptions. That includes the fact it has granted an exemption, names of exempted refineries, the volume of biofuels exempted, the years covered by the exemptions, as well as EPA's analysis of whether a small refinery would be subject to disproportionate economic harm complying with the RFS.

It was reported in November that EPA has put the waiver program on hold, pending a review.

Biofuels and agriculture interest groups have filed a number of lawsuits challenging how the EPA implements the waiver program.

Attorneys for the EPA, however, have argued in the U.S. District Court for the District of Columbia that the agency already accounts for waivers.

The National Biodiesel Board filed a court brief last summer arguing EPA should provide an estimate of how many biofuels gallons might be waived under small refinery exemptions and then set the required percentage volumes higher to account for waivers.

A group calling itself Producers of Renewables United for Integrity Truth and Transparency, or PRUITT, asked EPA in July to remove invalid RINs from the market and to stop issuing small refinery waivers until the agency changed the regulation. The agency didn't respond and was sued by the group at the end of July.

On Nov. 13, 2018, the group asked the U.S. Court of Appeals for the District of Columbia Circuit to force EPA to freeze the program.

Todd Neeley can be reached at todd.neeley@dtn.com

Follow me on Twitter @toddneeleyDTN

(TN)

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