API lawsuit challenges 2011 RFS biofuels provision

The American Petroleum Institute has filed a lawsuit in US Circuit Court for the District of Columbia on July 24 to challenge the US Environmental Protection Agency’s mandated use of cellulosic biofuels under the 2011 Renewable Fuel Standard. API argues that EPA is requiring refiners to use biofuels that don’t exist.

API Downstream and Industry Operations Director Bob Greco maintained that the mandate is unattainable and absurd because it forces refiners to pay a penalty for not using biofuels that aren’t even available. “The mandate is effectively an added tax on gasoline manufacturers that could ultimately burden consumers,” he said.

Greco said the Clean Air Act directs EPA to determine the mandated volume of cellulosic biofuels available each year as “the projected volume available.” EPA’s own records show that there was no commercial cellulosic biofuel supply in 2011, yet it required refiners and gasoline importers to use or pay for credits to cover 6.6 million gal of the nonexistent biofuels, Greco said.

He noted that EPA denied API’s petition to reconsider the mandate in May and continues to mandate nonexistent biofuels this year at even higher levels. In March, API filed a similar court challenge against EPA’s 2012 cellulosic biofuels requirement, which it said is also not attainable.

Greco said API continues to recommend that EPA base its prediction on at least 2 months of actual cellulosic biofuel production in the current year when establishing the following year’s mandated volumes. This would provide a more realistic assessment of potential future production than simply relying on assertions of companies whose ability to actually produce the amount of cellulosic biofuels EPA hopes for is questionable, he explained.

Contact Nick Snow at nicks@pennwell.com.

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