API, NPRA say EPA moved too quickly on renewable fuels rule

The US Environmental Protection Agency violated the 2007 Energy Independence and Security Act by not meeting the law’s deadlines or giving refiners and oil product importers enough time before making the latest federal renewable fuel standard final, two major oil and gas trade associations said on June 10.

June 11, 2010

2 min read

Nick Snow
OGJ Washington Editor

WASHINGTON, DC, June 11 -- The US Environmental Protection Agency violated the 2007 Energy Independence and Security Act by not meeting the law’s deadlines or giving refiners and oil product importers enough time before making the latest federal renewable fuel standard final, two major oil and gas trade associations said on June 10.

“EISA requires that EPA not impose renewable fuel volume obligations without giving producers and importers of gasoline and diesel the full month of lead-time and the full period for compliance specified by the statute,” the American Petroleum Institute and National Petrochemical & Refiners Association argued in the brief they filed in the US appeals court for the District of Columbia.

“Here, obligations began to accrue in January, but the RFS2 rule was not published until March and becomes effective only in July,” they continued.

The groups said that Congress specifically instructed EPA to set a biomass-based diesel fuel requirement for 2010 at 650 million gal, and that EPA violated this mandate by imposing a “combined” 2009-10 biomass-based diesel requirement of 1.15 billion gal after it was unable to meet the deadline for imposing a 500 million gal biomass diesel obligation for 2009.

“Although the RFS2 rule does not take effect until July 1, 2010, it nevertheless imposes obligations on transactions that occurred before that data,” the brief continued. “By imposing such obligations, the RFS2 rule violates the prohibition against retroactive rulemaking, and therefore is invalid.”

It said that EPA also did not meet deadlines which Congress adopted to give obligated parties the necessary lead-time to prepare for the RFS2 rule’s requirements and a specified period to comply with those requirements. Congress expressly required EPA to promulgate the rule by Dec. 19, 2008, and to publish each year’s renewable fuel standard by Nov. 30 of the preceding year, the brief said.

EPA published the RFS2 rule and 2010 renewable fuel standard in late March 2010, nearly three months after obligated parties began to accrue obligations under the rule, API and NPRA argued. “Consequently, obligated parties have less than the full year specified by Congress to meet their requirements for 2010,” they said.

Contact Nick Snow at [email protected].