In a move signaling the Biden administration's commitment to combating climate change, the Environmental Protection Agency (EPA) has denied almost all outstanding petitions from oil refiners seeking exemptions from biofuel blending mandates.
The decision, announced on July 15, rejects 26 petitions from 15 small refineries that applied for waivers covering the 2016-2018 and 2021-2023 compliance years, with only two petitions remaining pending.
Under the Renewable Fuel Standard (RFS), oil refiners are required to blend biofuels into the national fuel mix or purchase tradable credits from compliant entities. The EPA has the authority to grant exemptions to small refiners if they can prove that the blending obligations cause them undue economic hardship.
President Joe Biden's administration has been actively pursuing measures to reduce carbon emissions and steer the United States toward a net-zero emissions goal by 2050. The denial of these exemptions underscores the administration's determination to prioritize environmental goals.
Unlike the previous administration, which granted 34 exemptions to oil refiners for the 2017 compliance year alone, the Biden administration has not extended a waiver to any refinery thus far.
In making the waiver decisions, the EPA consulted with the Department of Energy and found that none of the petitioning small refineries demonstrated a disproportionate economic hardship caused by complying with the RFS.
As part of its commitment to transparency, the EPA also released the names of refiners that submitted small-refinery exemption petitions from July 2022 onward. Among the refiners whose petitions were denied were Calumet Montana Refining and Ergon Refining.
Additionally, the agency disclosed the names of refiners participating in an alternative compliance schedule that provides flexibility in meeting biofuel blending requirements. Sinclair Wyoming Refining Company and Kern Oil and Refining Company were among the refiners listed.
As per EPA data, 17 small refineries have chosen the alternative compliance schedule for the 2020 compliance year, the only year for which data was available. This group demonstrated compliance by retiring 360mn credits while still holding 510mn credits outstanding.
The EPA's publication of this information on its website aims to ensure transparency in its decision-making process regarding the RFS.
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