The US Environmental Protection Agency (EPA) announced a biofuel relief package on 4 October which it said would “ensure that more than 15bn gallons of conventional ethanol are blended into the nation’s fuel supply beginning in 2020”.
The EPA said it would release a supplementary proposal building off its pending 30 November decision on 2020 renewable volume obligations (RVOs) and 2021 biomass-based RVOs, Biomass Magazine reported.
An EPA spokesperson said the proposal would only account for future small refinery exemptions (SREs) but not provide a mechanism to reallocate volumes associated with SREs that had already been issued.
SREs exempt small US refineries (producing less than 75,000 barrels/day) from having to blend biofuels if they can prove they are in financial strife.
Since US President Donald Trump took office in January 2017, the EPA has more than quadrupled the number of SREs it has granted, exempting 85 small producers from blending 4bn gallons of renewable fuel from 2016-2018.
According to the Des Moines Register the SREs had “killed demand for 1.4bn bushels of corn used to make ethanol, and wiped out demand for 825M bushels of soyabeans that go into biodiesel”.
Some of the small refineries granted SREs were also owned by large petrochemical companies like Exxon Mobil and Chevron Corp, Reuters said.
The EPA’s announcement has drawn fire from oil companies, with the American Petroleum Institute and the American Fuel and Petrochemical Manufacturers saying that they “are deeply concerned about the administration’s decision to, once again, play politics with our fuel system by increasing an already onerous biofuel mandate, placing greater strain on US manufacturers and threatening higher costs for consumers”.
The biofuels industry has cautiously welcomed the plan, which will be open for public comment, saying it is a step in the right direction.
“It’s good that the president is directing the EPA to account for future SREs to ensure more than 15bn gallons is blended under the Renewable Fuel Standard (RFS) next year,” American Coalition of Ethanol CEO Brian Jennings said.
“It’s bad that the Trump administration is doing nothing to reallocate the more than 4bn gallons of RFS blending obligations waived from the 2016, 2017 and 2018 compliance years. These 85 waivers, combined with the trade war [with China] and weather-related diseases, have taken a terrible economic toll on rural America.”
