US court denies fuel waiver injunction
A US federal court today denied a request to block the Environmental Protection Agency (EPA) from issuing waivers that have slashed federal fuel blending requirements.
The Advanced Biofuels Association (ABFA) "has not satisfied the stringent requirements for an injunction pending court review," a three-judge panel of the DC Circuit Court of Appeals said.
EPA and the ABFA did not immediately comment on the decision.
ABFA requested the injunction in late April, citing still-redacted documents from a separate lawsuit challenging EPA's rapid increase in waivers of renewable fuel blending standards under former administrator Scott Pruitt. That lawsuit continues.
The association argued that EPA arbitrarily increased waivers to issue as many as possible. EPA has responded that the decisions were not a rulemaking that could be challenged in federal court and said it has followed the law to administer the program.
"Every gallon of renewable fuel obligation that is exempted represents renewable fuel that is unlikely to get produced, which means ABFA's members do not get paid, farmers receive lower prices, Congress' goal for a robust RFS program is diminished, and a gallon of traditional fuel — which has a far greater impact on climate change — is consumed," the association wrote.
RFS requires refiners, importers and other companies to each year ensure minimum volumes of renewables blend into the gasoline and diesel they add to the US transportation fuel supply. Companies prove compliance by acquiring renewable identification numbers (RINs), which represent each ethanol-equivalent gallon of renewables blended into conventional fuels. Obligated parties that do not blend their own fuel must acquire RINs from others.
Congress included exemptions for refineries smaller than 75,000 b/d that could demonstrate to the EPA and energy department that the program imposed a hardship. EPA issued few such waivers under President Barack Obama, using criteria since rejected by federal courts. But the waivers have surged under President Donald Trump's EPA administrators, to a record 40 applications still under review for the 2018 compliance year. One of those waivers was withdrawn over the past month. The 35 exemptions granted for 2017 waived the equivalent of 9.4pc of the 19.3bn USG of obligations for that year.
The waivers have increased the volume of unused, lingering RINs to levels that could render future exempted credits worthless. Obligated parties may only satisfy 20pc of their annual requirements with RINs carried over from previous years.
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