Maneuvers in the ethanol fuel quota battles of the Renewable Fuels Standards war continued as two US senators from agricultural states said they would introduce a bill that would establish a yearly June 1 deadline for small refiners seeking ethanol quota exemptions to petition the US Environmental Protection Agency.
This would ensure that EPA properly accounts for exempted gallons in the annual Renewable Volume Obligations it sets each November, sponsors Deb Fischer (R-Neb.) and Tammy Duckworth (D-Ill.) said on June 14.
The bill would build on fuel ethanol advocates’ recent victory in achieving year-round sales of gasoline with a 15% ethanol blend, Fischer indicated.
“In the past, EPA has issued small refinery exemptions after the [ethanol quotas] have already been determined. That’s unfair, and it hurts our farmers and ethanol producers,” Fischer said. “This bill would shine a light on what’s been an obscure exemption process and help promote economic growth in rural America.”
Duckworth added, “Farmers across Illinois and throughout the Midwest are hurting and ethanol plants are idling while this administration is abusing the small refinery exemption program to undermine the bipartisan [RFS].”
The senators said their bill also would increase transparency by ensuring that key information surrounding small refinery exemptions (SRE) is made publicly available. It also would require EPA to report to Congress on the methodology it uses when granting SREs, a process Fischer and Duckworth said has been carried out repeatedly behind closed doors with little to no congressional oversight.
American Fuel & Petrochemical Manufacturers Pres. Chet Thompson disagreed. “This bill would harm small refineries and afford them no protection from disproportionate economic impact of the RFS program,” he told OGJ on June 19.
“The bill would require waiver petitions to be submitted months before facilities know what their requirements will be, let alone whether they will be disproportionately impacted. The requirement to make confidential business information public is clearly intended to discourage small refiners from seeking protection in the first place,” Thompson said.
Calls for reform
“Lastly, SREs wouldn’t be necessary at all if Congress would step in to appropriately reform the RFS and its unrealistic mandates,” Thompson said.
That looks unlikely once federal lawmakers return from their Independence Day break. Without a gasoline supply disruption in the heart of the summer driving season, Senate and House leaders clearly believe there are more urgent issues to address.
The American Petroleum Institute’s latest monthly statistics, which it issued on June 20, showed that US gasoline demand averaged 9,457 million b/d during May, 1% less than a year earlier. Gasoline production at refineries averaged 10,179 million b/d, 0.5% more than in May 2018, according to API.
Nick Snow
NICK SNOW covered oil and gas in Washington for more than 30 years. He worked in several capacities for The Oil Daily and was founding editor of Petroleum Finance Week before joining OGJ as its Washington correspondent in September 2005 and becoming its full-time Washington editor in October 2007. He retired from OGJ in January 2020.
