API, NPRA legally challenge new EPA RFS

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, Mar. 29 -- The American Petroleum Institute and the National Petrochemical & Refiners Association filed separate legal challenges of the US Environmental Protection Agency’s final rule for the second stage of the Renewable Fuel Standard program (RFS2), which EPA published on Mar. 26.

The rule, which missed by a year the deadline established under the 2007 Energy Independence and Security Act (EISA), combines the 2009 and 2010 biomass-based diesel volumes and makes the entire rule retroactive to Jan. 1, API said in a statement. The two associations NPRA filed their petitions for a review of the regulation with the federal appeals court for the District of Columbia.

“The petition NPRA filed today does not challenge the overall RFS2 program and does not call into question the import role renewable fuels play in our nation’s transportation mix,” NPRA Pres. Charles T. Drevna said on Mar. 29. “Rather, our concern is with the unreasonable retroactive application of certain provisions of the rule and fundamental fairness in the implementation of policy.”

Drevna said EISA required EPA to promulgate and finalize certain standards under the RFS2 program by specific 2008 and 2009 dates. “The agency, however, failed to meet those statutory deadlines. Instead, in its recently published RFS2 final rule, EPA retroactively and unlawfully imposed RFS2 compliance burdens on obligated parties, many of whom are NPRA members,” he said.

API, meanwhile, said it considers the regulation unlawful and unfair. “While the US oil and natural gas industry recognizes and appreciates the role of ethanol and other biofuels in the fuel marketplace, we are deeply concerned that [EPA’s] final RFS2 rule could result in higher consumer costs,” its statement continued. “By setting retroactive requirements, refiners, and ultimately consumers, will be penalized for EPA’s inability to get this rule out on time as directed by Congress.”

“Simply put, the fact that EPA failed to meet its statutory obligations under current energy law does not give the agency license to impose retroactively additional compliance burdens on obligated parties,” said Drevna. “At the least, such action calls into serious question the fundamental fairness of EPA’s RFS2 rule-making process.”

Contact Nick Snow at nicks@pennwell.com.

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