EPA should consider a general waiver of biofuel requirements under the Renewable Fuel Standard (RFS) in a bid to help refiners with the impacts of the pandemic.
The lawmakers said that EPA should use its authority to make sure that RFS obligations for refineries provide “regulatory certainty for 2021, do not exceed the 'blend wall' of ethanol's proportion of actually marketable fuel blends, and—perhaps most pressingly—account for the unprecedented collapse in demand for gasoline, diesel and jet fuel resulting from the economic downturn associated with the COVID-19 crisis.”
The lawmakers said the downturn in demand means Renewable Volume Obligations (RVOs) for 2021 “must be reduced to prevent outstripping the 'blend wall,' an unprecedented rise in the cost of Renewable Identification Number (RIN) offset credits, or both.” They maintain that keeping current RVO levels or expanding them would impose “severe economic harm,” one of the conditions that indicate the need for a general waiver of RFS requirements. They also called on EPA not to reallocate any volumes linked to small refinery exemptions (SREs) and to set 2022 biodiesel and 2021 advanced and cellulosic biofuel levels at marks that ensure compliance.
“Put simply, EPA must not mandate blending too much biofuel into a dwindling fuel supply,” the lawmakers concluded, noting that any increases in the 2021 RVOs would impact consumers and shift economic hardships to refiners from ethanol producers.
EPA has not yet finalized the 2021 biofuel and 2022 biodiesel levels with its proposed rule still shown as being under review at the Office of Management and Budget (OMB). EPA Administrator Andrew Wheeler has signaled the COVID pandemic has prompted the agency to take a new look at the proposal and now the focus is on whether the agency will meet the November 30 deadline to finalize those levels.