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API, ethanol supporters squabble over 10th Circuit ruling

TAGS: Energy ethanol
i-Stockr/ThinkstockPhoto Biofuel plant at sunset
American Petroleum Institute argues EPA should reconsider 2020 RFS standards, ethanol industry says not so fast.

Ethanol supporters and the American Petroleum Institute have sent dueling letters to the Environmental Protection Agency on the 2020 Renewable Fuel Standard final rule.

On April 6, the American Petroleum Institute petitioned the EPA to reconsider and revise the final RFS Standards for 2020 and Biomass-Based Diesel Volume for 2021 published on Feb. 6, 2020, in light of the Tenth Circuit Court's unanimous decision in Renewable Fuels Association v. EPA.

The Tenth Circuit court challenge was brought against EPA by the Renewable Fuels Association, National Corn Growers Association, National Farmers Union, and American Coalition for Ethanol.

The API says reconsideration is mandatory because the decision was issued after EPA published the 2020 RFS rule and the decision undermines various aspects of the rule's treatment of Small Refinery Exempt volumes EPA projected would exist in 2020.

On May 1, the Renewable Fuels Association, National Corn Growers Association, American Coalition for Ethanol and National Farmers Union responded to the petition.

“There is no basis for revisiting or modifying EPA’s current approach until EPA acknowledges that the central tenets of the Tenth Circuit’s decision are appropriately applied throughout the country,” the groups wrote.

Specifically, API argues that the 2020 RFS rule should be revised to eliminate measures that prospectively “reallocate” RFS blending obligations expected to be lost to refinery waivers. API claims reallocation of expected waivers is no longer needed because the Tenth Circuit decision should significantly curtail the number of waivers granted. However, EPA has not yet confirmed that it will implement the tenets of the Tenth Circuit court decision nationwide, meaning reconsideration of the 2020 RFS rule would be woefully premature.

In fact, the 2020 RFS volumes should not be adjusted downward to remove reallocated volumes even after EPA applies the Tenth Circuit court decision nationally, according to the coalition’s letter.

“As noted by the Court, EPA’s recent abuse of its small refinery exemption authority has significantly harmed the U.S. ethanol industry. Indeed, nationally, more than four billion gallons of 2016-2018 renewable fuel volume requirements were lost due to EPA’s illegally issued small refinery waivers. Applying the Tenth Circuit decision nationally while leaving the 2020 RFS rule intact would begin to restore a small amount of the renewable fuel volume requirements lost to past small refinery exemptions; still, doing so would come nowhere near fully redressing the demand destruction wrought by the exemptions.”

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