EPA proposes extending renewable fuel deadlines: Update

Adds detail from filing.

The Environmental Protection Agency (EPA) today proposed extending into November the deadline for refineries to prove compliance with federal renewable fuel mandates in 2019.

The agency also proposed extending compliance deadlines for the 2020 mandates into 2022 in a draft rulemaking published today.

EPA stated in the rule that it took no position on controversial waivers of the mandates that biofuel groups expect the agency to grant in the final days of the current administration. Major biofuels trade groups remained concerned that EPA will still waive 2019 requirements for certain small refineries, reducing the total blending requirements for that year.

EPA proposed a new 2019 compliance deadline of 30 November 2021, with a 1 June 2022 deadline for refineries processing less than 75,000 b/d of crude a year. The 2020 mandates would have deadlines of 31 January 2022 and 1 June 2022 for small refineries, under the proposal. Deadlines to prove compliance for the 2019 mandates were last March, and for the 2020 compliance year March of this year.

RFS requires that refiners, importers and certain other companies each year ensure minimum volumes of renewables blend into the gasoline and diesel they add to the US transportation fuel supply.

The law includes an exemption for refineries processing less than 75,000 b/d of crude a year that can convince the Department of Energy and EPA that the requirements present a hardship. Approved waivers reduce the total mandates for a given year because the small refinery obligations do not shift to other, larger parties.

Rumors of surprise waivers have helped cut prices for credits used to prove compliance with the mandates over the past week and drawn condemnation from biofuels groups and powerful agriculture-state legislators.

"We urge you not to take such action," seven midcontinent senators including Chuck Grassley (R-Iowa) said in a letter to EPA administrator Andrew Wheeler dated today. Approval "would be a devastating blow to biofuel producers and farmers who sell them."

The administration just last week proposed a consent decree binding EPA to a decision on requests to waive 2019 requirements in the first weeks of president-elect Joe Biden's administration. Court challenges examining the agency's administration of the waivers await arguments before the US Supreme Court and the District of Columbia Court of Appeals this year.

Obligated party costs to comply with the RFS rose steadily in 2020 in the wake of a January court decision that would sharply limit use of the waivers and risk that sharply lower fuel consumption would leave obligated parties without the credits needed to meet 2020 mandates.

EPA in a separate rulemaking today proposed that no further action was needed to mitigate any adverse environmental impact from renewable fuel blending.

By Elliott Blackburn