Bill would increase SRE transparency, reallocate waived volumes

By Erin Voegele | May 23, 2019

Reps. Collin Peterson, D-Minn., and Dusty Johnson, R-S.D., introduced legislation May 23 that aims to increase transparency surrounding Renewable Fuel Standard small refinery exemptions (SREs) and ensure any waived volumes are reallocated.

The bill, titled the “Renewable Fuel Standard Integrity Act of 2019,” would ensure key information surrounding SREs is publicly disclosed. It would also set a deadline for refineries to submit SREs applications and ensure that the U.S. EPA reallocates waived volumes to non-exempt obligated parties.

Representatives of the biofuels industry have spoken out in support of the bill.

The Renewable Fuels Association issued a statement thanking Peterson and Johnson for their proactive efforts to rein in EPA’s abuse of the SRE program. “This bipartisan bill would prevent companies like ExxonMobil, Chevron, Holly Frontier, and CVR from further gaming the system and undercutting the Renewable Fuel Standard,” said Geoff Cooper, president and CEO of the RFA. “For five years in a row, EPA has failed to enforce the RFS conventional biofuel volume requirements set forth by Congress, even though there has been ample supply available at a low cost to meet the statutory volumes. The consequences of EPA’s chronic mismanagement of the RFS have been economically devastating for ethanol producers, farmers, and consumers alike.

“In recent years, the Congressionally required RFS volumes have been undermined by a surge in secretive small refiner exemptions and an abject failure on the part of EPA to reallocate those exempted volumes,” Cooper continued. “This bill would put an end to EPA’s destructive practices by effectively requiring the reallocation of any waived volumes and ensuring the statutory volumes are fully enforced. We applaud Chairman Peterson and Rep. Johnson for their work to restore transparency and integrity to the RFS.”

Growth Energy applauded the bill. “There is an urgent need to address the lack of transparency over small refinery exemptions, and reallocate the 2.6 billion lost gallons of biofuels demand as a result of these continued handouts to oil refineries,” said Emily Skor, CEO of Growth Energy.

“Currently, refiners have no deadline when submitting a request for a small refinery exemption, which allows them a secretive, backdoor way to avoid their legal obligations,” Skor continued. “The bipartisan Renewable Fuel Standard Integrity Act of 2019 sets the deadline for refineries to submit an application for an SRE by June 1st, as well as requires EPA to re-allocate exempted gallons so that biofuel targets are met in earnest. Additionally, the legislation prevents refineries from claiming submitted info as confidential business information, allowing the public greater insight into who is receiving these waivers and why.”

The American Coalition for Ethanol has also spoken out in support of the bill. “ACE thanks Chairman Peterson and Rep. Johnson for bipartisan legislation to correct EPA’s brazen mismanagement of the RFS small refinery exemption provision,” said Brian Jennings, CEO of ACE. “Under President Trump, EPA has retroactively granted more than 50 so-called hardship waivers for small refineries, erasing 2.61 billion gallons worth of the RFS blending obligations for 2016 and 2017 compliance years, and has 39 more requests pending for 2018.

“The uptick of waivers without reallocation as required by law has undermined Congressional intent of the RFS,” Jennings continued. “This legislation would help ensure EPA’s abuse of small refinery exemptions is put to a stop by requiring timely reallocation of any granted waiver and ensuring the statutory RFS volumes are enforced. ACE is grateful for the leadership of Chairman Peterson and Rep. Johnson to help get the RFS back on track by following the rule of law.”