Growth Energy: EPA Proposal a Mixed Bag for Biofuels Industry

WASHINGTON, D.C. – Today, Growth Energy CEO Emily Skor offered a mixed review of the U.S. Environmental Protection Agency’s (EPA) proposed rulemaking regarding domestic biofuels blending requirements under the Renewable Fuel Standard (RFS). The agency’s proposed Renewable Volume Obligations (RVOs) would undercut blending requirements for renewable, low-carbon biofuel in 2021, and would retroactively waive 2.96 billion gallons from 2020 RVOs set almost two years ago. Under the proposal, 2022 volumes return to statutory levels and the administration pledges to deny all improper small refinery exemptions (SREs).

“EPA’s projection of strong biofuel blending requirements in 2022, commitment to halt illegal refinery exemptions, and long-awaited progress toward complying with a 2017 court order on lost gallons represent a welcome step forward. These forward-looking plans underscore the critical role biofuels play in mitigating climate change and lowering prices at the pump. However, we are extremely disappointed EPA has proposed rolling back requirements for 2020 and lowering volumes for 2021.

“Retroactive cuts to 2020 blending requirements impact the entire fuel supply chain, including the farmers, producers, blenders, retailers, and responsible refiners who based business decisions on final requirements in place for some time.

“This unprecedented move not only exceeds EPA’s legal authority under the RFS, it fails to recognize the law’s built-in mechanism that adjusts requirements when fuel demand differs from original projections. At face value, the EPA’s plan for 2020 gallons serves as a giveaway to petroleum companies at the expense of rural families and future investment in low-carbon energy.

“The Biden Administration simply cannot meet its climate goals while retroactively rolling back low-carbon biofuel blending requirements to help oil refiners. On the campaign trail, President Biden committed to strengthening the rural economy and addressing climate change with a strong RFS and we hope to see the president’s promises fully reflected in the final rule. We look forward to engaging with the EPA during the comment period to get the RFS fully back on track.”

The agency’s draft rule would lower conventional ethanol volume to 12.5 billion gallons for 2020, advanced biofuel at 4.63 billion, and cellulosic at 510 million. In addition, it would set conventional ethanol at 13.32 billion gallons in 2021 and 15 billion gallons in 2022, while advanced biofuels would be set at 5.2 billion gallons in 2021 and 5.7 billion gallons in 2022, including 620 million gallons of cellulosic biofuel in 2021 and 770 million gallons of cellulosic biofuel in 2022. The proposal also adds a supplemental 250 million gallons in 2022 and 250 million gallons in 2023, deny the 65 pending small refinery exemption requests before the agency, and provide important guidance to limit the abuse of small refinery exemptions in the future.

For more information and background on RVOs, please click here.