WASHINGTON, D.C. – Today, Growth Energy CEO Emily Skor released a statement in support of the U.S. Environmental Protection Agency’s (EPA) rulemaking under the Renewable Fuel Standard (RFS), which sets the 2022 Renewable Volume Obligation (RVO) for conventional biofuels at 15 billion gallons, a move that sets a baseline for strong future biofuel blending levels under the RFS, ensuring drivers have greater access to lower-cost, lower-carbon fuel at the pump.
“These last six months have been a rude awakening for those who have grown complacent about U.S. energy supplies. EPA’s 2022 renewable fuel blending requirements will deliver savings at the pump for working families, slash carbon emissions, and strengthen U.S. energy security by bringing more American renewable fuel into our fuel supply.
“In just the last few months, E15 has been a shield against skyrocketing fuel prices, saving drivers almost $0.60 per gallon in some areas while American biofuels cut greenhouse gas emissions by 46 percent compared to gasoline.
“We applaud President Biden and his EPA for this action, which will set the direction of total and advanced renewable fuel volumes for 2023 and beyond. By setting conventional implied 2022 RVO volumes at 15 billion gallons, coupled with restoring the first 250 million gallons that had been illegally waived in the 2016 RVO, EPA underscores the critical role biofuels play – and will continue to play – in mitigating climate change and lowering prices at the pump. Moreover, it sends a positive signal as the agency works through its new rule – “the Set” – that picks up where Congress left off and establishes multi-year renewable fuel blending requirements for 2023 and beyond.
“In addition to the 2022 volumes, today’s action from EPA halts all improper small refinery exemptions, a move that will return much needed certainty to the biofuels industry and the entire fuel supply chain.
“EPA does fail to address bipartisan concerns about volume requirements for the 2020 and 2021 RVOs. Nevertheless, we take the 2022 volumes as a strong signal of EPA’s commitment to getting the RFS back on track and we will remain vigilant in ensuring that volumes are met in a timely manner.”
Audio of Emily Skor’s statement is available here.
The agency’s final rule lowers conventional ethanol volumes to 12.5 billion gallons for 2020, advanced biofuel at 4.63 billion, and cellulosic at 510 million. In addition, the rule sets conventional ethanol at 13.79 billion gallons in 2021 and 15 billion gallons in 2022, while setting advanced biofuels at 5.05 billion gallons in 2021 and 5.63 billion gallons in 2022, including 560 million gallons of cellulosic biofuel in 2021 and 630 million gallons of cellulosic biofuel in 2022. The rule adds a supplemental 250 million gallons that had been illegally waived in the 2016 RVO and denies 72 pending small refinery exemption requests before the agency. EPA’s announcement also provides important guidance to limit the abuse of small refinery exemptions in the future.
From the onset of the Renewable Fuel Standard, each year through 2022, EPA is required to issue a rulemaking establishing volumes of renewable fuel (the “renewable volume obligation” or “RVO”) that obligated refiners and importers must blend to ensure that annual renewable fuel volume requirements established by statute are met. Failure to issue RVOs on time undermines the RFS by eliminating prospective, market-forcing blending obligations, and by creating uncertainty in the market for obligated parties and renewable fuels producers alike. For more information on RVOs, click here for FAQ.
For 2023 and later, and as it has already done for the 2020-2022 RVOs under its “reset” authority, EPA, in coordination with the Department of Energy (DOE) and the Department of Agriculture (USDA), is required to “set” these renewable fuel volume requirements through one or more rulemakings, taking into consideration six statutory factors, including environmental impacts economic impacts, and energy security. EPA is required to set volume requirements for 2023 at least 14 months prior to the calendar year in which it is to take effect. In addition, EPA is constrained by the statute to ensure that, for each year starting in 2023, the advanced renewable fuel requirement is at least the same percentage of the total renewable fuel requirement as it was in 2022.
In December 2021, Growth Energy submitted to the Environmental Protection Agency (EPA) a notice of intent to sue (“NOI”) regarding its failure to timely fulfill the agency’s statutory obligation under the Renewable Fuel Standard (RFS) to issue the 2022 Renewable Volume Obligation (RVO) and in turn, the potentially multi-year “set” rulemaking process for renewable fuel volumes for 2023 and beyond. The RVOs for 2022 were due by November 30th, 2021, an annual deadline set by Congress in the RFS. Additionally, the final “set” rulemaking was due on November 1, 2021. Growth also previously submitted a NOI for EPA’s failure to timely issue the 2021 RVO, which was due on November 30, 2020.
In response to the NOI, Growth Energy and EPA reached agreement to enter into a consent decree to finalize the delayed 2021 and 2022 RVOs by no later than June 3, 2022. EPA then issued a notice of the proposed consent decree for public review and comment. After the close of the comment period on March 25th, EPA and Growth then jointly filed a motion in the U.S. District Court for the District of Columbia seeking approval of the consent decree, which the court granted on April 22, 2022.
EPA released its proposed RVOs for 2020, 2021, and 2022 on December 7, 2021. In January 2022, Growth Energy CEO Emily Skor testified before EPA on its proposed rule.