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Reject the petroleum industry’s RFS waiver petition?

Hydrocarbon Engineering,

BIO has written to the EPA Administrator Gina McCarthy, asking her to reject the recent petition from the American Petroleum Institute (API and American Fuel and Petrochemical Manufacturers (AFPM) for a waiver of the 2014 volume obligations under the RFS. BIO emphasised that because petroleum refining companies enjoy great flexibility in planning and choosing among compliance options under the RFS, they can easily avoid causing the harm to the US economy that the trade organisations foretell.

Letter extracts

Brent Erickson, executive VP of BIO’s Industrial & Environmental Section, wrote the following;

‘BIO urges the EPA to deny the joint petition for several reasons. First, the petitioners do not meet the requirements to file the joint petition. The joint petition is also premature. The petitioners cannot demonstrate harm when the 2014 renewable volume obligations (RVOs) have not eben been formally proposed.’

On page 11 Erickson continued:

‘The reality is that because they have blocked investment in infrastructure and created marketing challenges for higher blends of biofuels, the petitioners are now requesting the Administrator waive the 2014 RVOs to 9.7% of the domestic fuel supply. They created the very situation from which they are requesting relief.

‘There are a host of RFS compliance choices explained in detail below, which taken together provide obligated parties sufficient flexibility and time to plan compliance strategies for 2014 and beyond. Since these compliance options exist, obligated parties have sufficient tools to plan ahead for the accumulation of RINs to meet their 2014 RFS RVOs. While some individual refiners may choose to restrict US fuel supply as a compliance strategy, market competition and the increasing production of biofuels will work in tandem so such a restriction will not harm the US economy or consumers.’

Erickson concluded:

‘EPA should deny the requests because the projected harm to the US economy would stem not from the 2014 RFS RVOs, but rather from the ongoing dilatory tactics of the very parties seeking the waivers. The blend wall was anticipated five years ago at the outset of RFS implementation and obligated parties have largely chosen not to prepare for the blend wall. They have not encouraged or facilitated infrastructure investment or new fuel marketing. Instead, most of them are spending their time and advocacy trying to chill investment in greater biofuels production. This includes their filing the joint petition, which is opposed by BIO as reflected in these comments. The petitioners and their members should not be rewarded for these efforts.’

Adapted from a press release by Claira Lloyd.

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