Siouxland Energy Cooperative President Kelly Nieuwenhuis was among those who testified before the U.S. House of Representatives Energy and Commerce Subcommittee on Environment and Climate Change Oct. 29.

Nieuwenhuis, who also is farmer near Primghar, Iowa, discussed the devastating impact of the Environmental Protection Agency’s policies on his biofuel plant and the surrounding community.

“Plain and simple: EPA’s abuse of small refinery exemptions under the RFS is crippling rural America,” said Nieuwenhuis in his testimony to lawmakers.

“Because of EPA’s actions to help the oil industry’s bottom line at the expense of farmers and biofuel producers, we had to make a hard decision – to idle our plant and shut off a key market for hundreds of local farmers, including myself,” added Nieuwenhuis. “The morning we announced we were idling our plant, I was tasked with delivering the bad news to our 40 employees. The team sat quietly, wondering about their future in the event we would have to permanently close our facility. This was one of the toughest things I’ve ever had to do.”

“The economic crisis created by the EPA’s abuse of SREs started 3 years ago. At first, we couldn’t put a finger on what it was, but the fundamentals in our market seemed off.  It was only after the press started reporting the rapid escalation of SREs being granted behind closed doors at the EPA that we began to understand what was happening to our business.”

Nieuwenhuis also gave his support for the legislation being considered by the subcommittee, H.R. 3006, the RFS Integrity Act of 2019.

“The regulatory attempts by the EPA give us little confidence that we will see the relief we need,” said Nieuwenhuis. “That’s why the agricultural and biofuels industries strongly support H.R. 3006, the RFS Integrity Act, sponsored by Representatives Collin Peterson and Dusty Johnson. This bill would address the EPA’s dismal record on SRE transparency. We have no idea of the specifics used by DOE or EPA in making SRE decisions, and this bill takes care of these basic transparency concerns by setting a reasonable deadline for SRE applications, and giving the public greater insight into this murky process.”

Joining Nieuwenhuis in giving testimony during a hearing, "Protecting the RFS: The Trump Administration's Abuse of Secret Waivers,” were Geoff Cooper, president and CEO, Renewable Fuels Association; Gene Gebolys, president and CEO, World Energy, and Chet Thompson, president and CEO, American Fuel & Petrochemical Manufacturers.

Thompson said small refinery waivers have not had any impact on biofuel demand, saying it is at or near record highs.

“AFPM opposes the legislation under consideration today, H.R.3006, as it is both practically unworkable and would eliminate critical protections for refineries’ confidential business information,” Thompson said. “The committee should instead consider substantial, long-term reforms to the RFS that can benefit all stakeholders.”

Gebolys said EPA’s waivers are destroying demand for biomass-based diesel, which is having a devastating impact on the industry. World Energy has closed three facilities, impacting more than 100 employees.

“When EPA finalizes its 2020 renewable fuel obligations rule by the end of this year, it must fully account for small refinery exemptions, or industry contraction and job losses will continue throughout the biofuels and broader agricultural economy,” he said.

Cooper said because the RFS has succeeded in replacing petroleum with cleaner renewable fuels, it is under attack from the fossil fuel industry.

“Refiners claim that when they choose to purchase RFS compliance credits (known as Renewable Identification Numbers, or “RINs”) from competitors in lieu of blending renewable fuels, an insufferable financial burden is created that warrants regulatory “relief.” Of course, empirical evidence, the practical experience of market participants, the legislative and regulatory history, and an expansive body of scientific literature expose these arguments as absurd and contrived,” Cooper said.

Growth Energy CEO Emily Skor, who will testify Wednesday, Oct. 30, at the EPA’s public hearing on the new proposal, applauded Nieuwenhuis for sharing his story with lawmakers.

“Dozens of biofuel plants, just like Siouxland Energy, have been forced to idle production or close their doors in the past year due to the EPA’s abuse of refinery exemptions,” said Skor. “We need the real fix President Trump promised – not another round of regulatory games. The EPA plan must incorporate a projection of actual exempted gallons, not simply apply out-of-date recommendations. This may be our last chance to restore rural jobs and ease the burden facing American farmers.”

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