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Several small U.S. refiners plan to challenge in court last week’s decision by the Environmental Protection Agency (EPA) to deny waivers to refiners who had asked to be exempted from the biofuel blending requirements, one of the refiners, Par Pacific, has told Reuters.
Under the Renewable Fuel Standard (RFS), oil refiners are required to blend growing amounts of renewable fuels into gasoline and diesel. Refiners that don’t have the infrastructure to blend biofuels must purchase tradeable blending credits known as Renewable Identification Numbers, or RINs.
The EPA has the authority to grant waivers from the RFS to refineries whose oil processing capacity is below 75,000 barrels per day (bpd) and who can prove that blending biofuels would hurt them financially to an unsustainable level.
The EPA denied on Friday as many as 26 petitions from 15 small refineries that had applied for waivers for the 2016-2018 and 2021-2023 compliance years. Two of the outstanding petitions are still pending.
“After reviewing more than a decade of RFS market data and confidential information submitted by petitioning small refineries, EPA concluded that none of the 26 SRE petitions demonstrated disproportionate economic hardship caused by compliance with the RFS program,” the EPA said.
Since taking office, the Biden Administration has not granted a single waiver to any refiner that has applied to be exempted from the biofuel blending requirements, according to data from the EPA.
The Biden Administration, looking to cut emissions, is denying waivers for biofuel blending mandates, in stark contrast with the Trump Administration, which granted 34 waivers to refiners for the compliance year 2017 and 17 waivers for the compliance year 2016.
Now the small refiners seek to challenge the Biden Administration’s denials of waivers by joining forces in a lawsuit, Par Pacific spokesperson Ashimi Patel told Reuters.
“We believe EPA's decision is arbitrary, capricious, and contrary to law,” the spokesperson said.
By Charles Kennedy for Oilprice.com
Charles is a writer for Oilprice.com