Dec 19 - EPA Finalizes RFS Volumes for 2020 - Producer Groups Respond

EPA Fulfills Another Trump Administration Promise: Finalizes RFS Volumes for 2020 and Biomass Based Diesel Volumes for 2021

Today, the U.S. Environmental Protection Agency (EPA) finalized a rule that establishes the required renewable volumes under the Renewable Fuel Standard (RFS) program for 2020, and the biomass-based diesel volume for 2021. Through this action, the Trump Administration has fulfilled yet another key promise to the American people, American farmers and American biofuels producers by increasing biofuels volumes under the renewable fuel standard and modifying the program requirements to ensure those volumes are met. The EPA is committed to ensuring a net of 15 billion gallons of conventional biofuel is blended in 2020.

“Through President Trump’s leadership, this Administration continues to promote domestic ethanol and biodiesel production, supporting our Nation’s farmers and providing greater energy security,” said EPA Administrator Andrew Wheeler. “President Trump committed to our nation’s farmers that biofuel requirements would be expanded in 2020. At the EPA we are delivering on that promise and ensuring a net of 15 billion gallons of conventional biofuel are blended into the nation’s fuel supply.”

Under the Trump Administration, EPA has consistently increased the renewable volume obligations and continued to expand the nation’s renewable fuels sector. Through this rule, EPA has modified the RFS program by projecting small refinery relief to ensure that these final volumes are met, while adjudicating small refinery relief when appropriate. As proposed, we are finalizing a projection methodology based on the 2016-2018 annual average of exempted volumes had EPA strictly followed the Department of Energy (DOE) recommendations of 770 million Renewable Identification Numbers (RINs) in those years, including granting 50 percent relief where DOE recommended 50 percent relief. This is our general approach to adjudicating Small Refinery Exemption (SRE) petitions going forward, beginning with 2019 SRE petitions and including 2020 SRE petitions and beyond, we are committed to following the DOE recommendations. By proposing effectively 15.8 billion gallons for 2020 we will ensure meeting our target of 15 billion gallons.

The key elements of today’s action are as follows:
-    “Conventional” biofuel volumes, primarily met by corn ethanol, will be maintained at the 15 billion gallon target set by Congress for 2020.
-    Cellulosic biofuel volumes for 2020, and thus advanced biofuel volumes, will increase by almost 170 million gallons over the 2019 standard.
-    Biomass-based diesel volumes for 2021 will be equivalent to the standard for 2020, still more than double the statutory requirement.
-    EPA will closely examine the labeling requirements for E15 fuel and move forward with clarifying regulations as needed.
-    EPA has modified the way RFS obligations are determined to better ensure that these volumes are met, while still allowing for relief for small refineries consistent with the direction provided by Congress under the statute. By proposing effectively 15. 8 billion gallons we will net out at 15 billion.

This final rule is the latest in a series of steps the Administration has taken to expand domestic energy production and improve the RFS program which will help American farmers.

More information can be found here: https://www.epa.gov/renewable-fuel-standard-program/final-renewable-fuel-standards-2020-and-biomass-based-diesel-volume. 



Fischer Statement on Final RFS Volumes for 2020

U.S. Senator Deb Fischer (R-Neb.), a member of the Senate Agriculture Committee, released the following statement today after the Environmental Protection Agency (EPA) announced the final rule establishing Renewable Volume Obligations for 2020 and the biomass-based diesel volume for 2021 under the Renewable Fuel Standard (RFS):

“I appreciate the Nebraskans—including our farmers and ethanol producers— who made their voices heard and submitted comments to EPA. Like many of them, I am disappointed in this announcement because it differs from the commitment made to my colleagues and me this fall that the 15 billion gallon obligation would be met using a 3-year rolling average of actual waived gallons. Instead, the EPA has chosen to use their own discretion and the Department of Energy’s recommendations when determining waived gallons, despite their track record of disregarding these recommendations.

“While the final rule is still an improvement over the previous one, I am, and I know Nebraskans are, wary that the EPA will follow the law and meet these obligations like they say they will. President Trump cares about farmers and has made big promises to rural America. I will continue to work to make sure those promises are fulfilled.”

More information:
In October, the EPA announced an RFS deal. As part of the deal, the agency said it would begin to account for projected numbers of gallons exempted when setting new Renewable Volume Obligations for refiners starting in 2020.

In November, Senator Fischer submitted a letter to EPA Administrator Wheeler expressing concern about the way the agency plans to calculate the reallocation of biofuel gallons lost due to exemptions for oil refineries.

Senator Fischer has long advocated for bringing more transparency to the exemption process. Earlier this year, she introduced the bipartisan RFS Integrity Act with Senator Tammy Duckworth (D-Ill.). The legislation would ensure the EPA properly accounts for exempted gallons and ensures that key information surrounding small refinery exemptions is made publicly available.



Sasse Statement on EPA Renewable Volume Obligations Rule

U.S. Senator Ben Sasse, an outspoken advocate for Nebraska agriculture, issued the following statement regarding the Environmental Protection Agency’s announcement of a final Renewable Fuel Standard volume obligations rule that does not match a previous agreement at the White House.

“This is a disappointment. We made some real progress at a White House meeting that President Trump, EPA Administrator Wheeler, and Senators Fischer, Grassley, Ernst and I attended, but the EPA is doing something different. Nobody there agreed to this and, once again, the EPA is asking us to trust them to do the right thing. Like a lot of Nebraskans, I am skeptical about how the EPA is going to implement this.”



Ricketts Comments on EPA’s 2020 RFS Blending Levels

Today, Governor Pete Ricketts issued the following statement after the U.S. Environmental Protection Agency’s (EPA’s) release of the final rule setting the 2020 renewable fuel blending levels under the federal Renewable Fuel Standard (RFS).

“Today’s announcement from the EPA does not include the structural changes we requested in our comments on the draft rule,” said Governor Ricketts.  “President Trump has promised 15 billion gallons, and we will be watching closely to see how the EPA enforces the final rule to ensure this level is blended as required by law.  We will hold the EPA’s feet to the fire if they fall short of delivering on the President’s promise of 15 billion gallons to our farm families.”



Statement by Steve Nelson, President, Regarding EPA Announcement of Renewable Fuels Standard (RFS) Blend Volumes

“While EPA claims this new rule will ensure the agency meets the Congressionally mandated goal of blending 15 billion gallons of biofuels into our nations fuel supply in 2020, we still have great concerns about EPA having previously granted an excessive number of waivers relieving oil refiners of their legal obligations to blend biofuels. We are disappointed EPA did not incorporate changes Nebraska Farm Bureau had requested to improve EPA’s accounting of the allowable volume of exemptions. By not making those changes EPA is asking us to trust they will meet the blend target. With that said, we are in the ‘trust but verify’ mode and remain committed to ensuring that 15 billion gallons of blended biofuels as mandated by Congress translates to 15 billion gallons of blended biofuels.”



Iowa Corn Farmers Cheated out of a Good Farm Economy Due to RFS Abuse

The abuse of the Renewable Fuel Standard (RFS) continues as the Environmental Protection Agency (EPA) released today the final 2020 Renewable Volume Obligation (RVO) that does not reflect the deal President Trump agreed to on October 4, 2019.  The finalized rule incorporates the Wheeler plan that merely estimates future small refinery waivers based on the Department of Energy’s (DOE) recommendations. ICGA supports a simple, mathematical solution by averaging the past three years of actual waivers granted, then adding those gallons back into the RFS. ICGA’s supported resolution would have created market certainty, so as not to rely on the EPA or DOE Administrators for their annual decisions.

“Apparently President Trump doesn’t care about his promise to Iowa’s farmers. He had the opportunity to tell his EPA to stick to the deal that was made on October 4,” said ICGA President Jim Greif. “I can say for certain that ICGA pushed for a positive outcome, and we didn’t go down without a fight.”

“The Environmental Protection Agency seems to be more concerned with politics than cleaner-burning, healthy air with renewable fuels. It was as simple as following the original October 4 agreement with our elected officials and here we are with empty promises and no market certainty,” said Kelly Nieuwenhuis, ICGA member from Primghar and Chair of the Iowa Corn Industrial Usage and U.S. Production committee.

During the comment period for the supplemental rule, ICGA sent out two calls to action with one directed at the EPA and the other at the President. Altogether the calls to action gathered over 1,000 farmer comments. Additionally, ICGA held a press conference along with other biofuels groups, worked with our entire delegation of public leaders, as well as attended roundtables, townhall meetings and EPA’s public hearing in Ypsilanti, MI. The final push was a meeting by ICGA with the Director of the U.S. National Economic Council, Larry Kudlow, at the White House earlier this week.

ICGA extends a thank you to each Iowa Corn member, farmer, ethanol supporter, and our public officials who have worked diligently together with Iowa’s corn farmers to maintain the critically important RFS.

“On behalf of Iowa Corn Growers Association members, we are frustrated with this lack of interest in defending markets for ethanol and renewable fuels. ICGA will not stop fighting for market access for corn in all forms,” said Greif.



EPA's RVO Ruling Hurts America's Heartland

Iowa Secretary of Agriculture Mike Naig issued the following statement in response to the EPA’s final rule on the Renewable Volume Obligations (RVOs) for 2020 and biomass-based diesel volume for 2021.

“I’m disappointed the EPA chose to ignore the concerns voiced by renewable fuels producers, farmers and consumers. The flawed formula used to account for waived gallons creates unnecessary uncertainty in our markets, detrimental to so many across rural America,” said Secretary Naig. “We must continue to work together to hold the EPA accountable for ensuring the 15 billion gallons mandated by the Renewable Fuels Standard are met. We must also continue to invest in infrastructure that builds demand and increases the availability of higher blends of biodiesel and ethanol across the state of Iowa.”

The Iowa Department of Agriculture and Land Stewardship administers the Iowa Renewable Fuel Infrastructure program, which offers cost-share grants to help fuel retailers install infrastructure to increase the availability of ethanol and biodiesel. Secretary Naig has requested $3 million in the fiscal year 2021 to continue supporting the program. To date, the program has distributed or obligated over $33 million with $200 million added in private economic activity. This translates to every dollar invested in Renewable Fuel Infrastructure funding, nearly six dollars of private investment has resulted.



NCGA: Corn Farmers Underwhelmed by Final RVO Rule

National Corn Growers Association (NCGA) President Kevin Ross today made the following statement on the release of the Environmental Protection Agency (EPA) final 2020 Renewable Volume Obligation (RVO) rule, setting renewable fuel volume requirements for the coming year, including accounting for 2020 refinery waivers. The final rule uses a three-year average of the Department of Energy (DOE) recommended waivers as an estimate for 2020 waivers rather than an average of actual gallons waived by the EPA.

“The Administration has chosen to move forward with a final rule that corn farmers believe falls short of adequately addressing the demand destruction caused by EPA’s abuse of RFS refinery waivers. While using the DOE recommendations to account for waivers is an improvement over the status quo, it is now on corn farmers to hold the Administration to their commitment of a minimum of 15 billion gallon volume, as the law requires. We will use future rulemakings and other opportunities to hold the EPA accountable.”



Growth Energy says more action needed by EPA to restore biofuel growth

Growth Energy, the nation’s largest ethanol association, today called for the Environmental Protection Agency (EPA) to take further action to restore growth under the Renewable Fuel Standard (RFS) after the agency released its final 2020 biofuel targets. While the final rule provides an uptick in federal biofuel targets and signals an intent to account for demand lost to oil refinery exemptions, Growth Energy stressed that the agency must enforce those volumes by accounting for exemptions accurately and that EPA Administrator Wheeler must take additional steps to uphold the administration’s October 4th commitments to rural America.

“President Trump pledged to deliver certainty and stability for America’s farmers and biofuel producers by restoring integrity to the RFS,” said Growth Energy CEO Emily Skor. “While we’re encouraged that EPA is finally taking steps to follow the law and account for biofuel demand lost to secretive oil refinery exemptions, this rule leaves important work unfinished.

“Integrity is restored to the RFS only if the agency accurately accounts for exemptions it will grant. The rule uses an accounting formula based on Department of Energy recommendations, which EPA has a poor track record of following. All eyes will now be on EPA’s next round of refinery exemptions and future targets, which will signal whether Administrator Wheeler is truly committed to ending demand destruction.

“Additionally, Administrator Wheeler must act swiftly to break down remaining market barriers to E15 as promised in the October 4th EPA announcement. When the RFS is working as intended and government has eliminated market access barriers, drivers across the nation will able to take full advantage of the administration’s move to unleash sales of E15 year-round.”

“We are grateful to all our champions who have worked tirelessly to restore growth under the RFS, and we look forward to working with them in the year ahead to restore the biofuels market for America’s struggling farmers and biofuel producers.”



RFA: EPA Rule Won’t Prevent Further RFS Erosion by Waivers

The Renewable Fuels Association today expressed disappointment in the Environmental Protection Agency’s final rule for 2020 Renewable Fuel Standard blending requirements, arguing that the rule opens the door for small refinery exemptions (SREs) to continue eroding RFS volumes and destroying demand for America’s biofuel producers and farmers.

“After EPA’s overwrought abuse of the SRE program in recent years, agency officials had a chance to finally make things right with this final rule—but they blew it,” said RFA President and CEO Geoff Cooper. “EPA’s rule fails to deliver on President Trump’s commitment to restore integrity to the RFS, and it fails to provide the market certainty desperately needed by ethanol producers, farmers, and consumers looking for lower-cost, cleaner fuel options. While the final rule is an improvement over the original proposal, it still does not guarantee that the law’s 15-billion-gallon conventional biofuel blending requirement will be fully enforced by EPA in 2020.”

According to the rule released today, EPA will project SRE volumes based on historical Department of Energy (DOE) recommendations, rather than the actual volume of SREs issued by EPA. Ironically, however, EPA has generally chosen to ignore DOE’s recommendations regarding SRE petitions in recent years. For the 2016-2018 compliance years, the volume of required renewable fuel blending waived by EPA was almost double the amount recommended by DOE.

“After doing the exact opposite in recent years, EPA is now suggesting it will follow DOE’s recommendations on 2020 SRE petitions,” Cooper said. “So, now the waiting game begins. We’ll have to wait with bated breath until at least the spring of 2021 to see whether EPA truly makes good on its promise to follow DOE recommendations on 2020 SREs.”

In the meantime, RFA will be keeping a close eye on EPA’s handling of the 2019 SRE petitions, 10 of which have already been received by the agency. “With historically low RIN credit prices, record high RIN stocks, and ample supplies of low-cost ethanol available, it will be difficult—if not impossible—for refiners to claim they need a ‘hardship’ exemption for 2019,” Cooper said. “Still, EPA’s approach to the 2019 SRE petitions will probably be a pretty good indicator of whether the agency is truly interested in following DOE recommendations and exercising more restraint and judiciousness moving forward.”

RFA also urged the Administration to expeditiously move ahead on the other elements of the biofuels package announced by EPA on October 4, including streamlining E15 labeling requirements, removing other barriers to the sale of E15, addressing ethanol trade barriers, and launching a program to expand infrastructure for higher ethanol blends.

“Offsetting the RFS volumes lost to SREs was only one piece of the plan promised by the President and rolled out by EPA in October,” Cooper said. “And while the plan released by EPA today for addressing SREs doesn’t go nearly far enough, the ethanol industry is eager to work with EPA and USDA to quickly implement the other relief measures included in the package.”



ACE: EPA’s final 2020 RFS rule fails to uphold the President’s biofuel deal

Today, the Environmental Protection Agency (EPA) issued its final Renewable Volume Obligations (RVOs) for the 2020 Renewable Fuel Standard (RFS) along with its finalized supplemental rulemaking that addresses how the Agency will handle the Small Refinery Exemption (SRE) provision in the program moving forward. American Coalition for Ethanol (ACE) CEO Brian Jennings issued the statement below in response:

“Over the course of the past few months, we’ve gone from promises of a ‘giant package’ to the reality of a lump of coal. To say we are disappointed is an understatement. While it was well understood this rulemaking would not make farmers and the ethanol industry ‘whole’ for the damage EPA has done by abusing the small refinery exemption provision of the RFS, we were led to believe the rule would represent a step in the right direction, an opportunity to account in a meaningful way for refinery waivers.

“We are forced yet again to continue defending the RFS and fighting EPA’s mismanagement of the program in the third branch of government, but this is another painful reminder our industry needs to go on offense with a new plan to increase demand on ethanol’s low carbon and high octane advantages.”



NBB Disappointed with Lack of Growth in 2020 RFS Volumes

The National Biodiesel Board (NBB) today expressed its disappointment with the Environmental Protection Agency’s final rule for the 2020 Renewable Fuel Standard. The rule maintains the 2020 overall advanced volume and 2021 biomass-based diesel volume at the same levels as the current year, blocking growth for the biodiesel industry. The rule also finalizes a method that underestimates future small refinery exemptions, counting only half of the exempted volumes actually granted over the past three years.

Kurt Kovarik, NBB’s VP of Federal Affairs, stated, “EPA’s final rule for the 2020 RFS volumes is simply out of step with Congressional intent and President Trump’s promises. This week, Congress and the president are extending the biodiesel tax incentive through 2022 and sending an unmistakable signal that they support continued growth of biodiesel and renewable diesel. At the same time, EPA Administrator Wheeler is doing everything he can to block that growth.”

EPA sets the overall advanced biofuel volume for 2020 at 5.09 billion gallons, providing growth only for cellulosic biofuel. Other advanced biofuels, such as biodiesel and renewable diesel, received no additional market space. EPA maintains the 2021 biomass-based diesel volume at 2.43 billion gallons, the same volume as for 2020.

Kovarik continued, “Despite his statement to the press, Administrator Wheeler’s method for estimating future small refinery exemptions does not provide assurance to the biodiesel and renewable diesel market. The best estimate of future exemptions is an average of the 38 billion gallons exempted over the past three years. Even if EPA had included that estimate, though, there is nothing in today’s rule to ensure that the agency will get these exemptions under control.”

The estimate of small refinery exemptions applies equally to the overall, advanced, biomass-based diesel, and cellulosic biofuel renewable volume obligations (RVOs). While intended to ensure that the 2.43 billion biomass-based diesel volume for 2020 is fulfilled, the number of exempted volumes could still exceed EPA’s estimate.

In today’s rule, EPA defers a final determination on the U.S. Court of Appeals’ remand of the 2016 rule, in which the agency waived 500 million gallons of biofuel use. “The biodiesel industry asks EPA to fulfill the Court’s clear direction to restore the 500 million gallons from 2016. The agency has recognized that it must ensure that the RFS volumes are met. EPA must be consistent.”



Trump Breaks Promise to Rural America with Renewable Volume Obligations

The U.S. Environmental Protection Agency (EPA) today released its final renewable volume obligations (RVOs) under the Renewable Fuel Standard (RFS) for the year 2020.

As outlined in a supplemental proposed rule in October, the RVOs will account for a portion of the 4 billion gallons of demand for biofuels eliminated over the past three years due to the rampant misappropriation of small refinery exemptions (SREs). Rather than determine relief using an actual three-year average of exempted gallons, the agency has instead used much lower values recommended by the Department of Energy (DOE). The former would have increased the amount of biofuels in the transportation sector by approximately 1.35 billion gallons per year, while the latter will increase it by just 770 million gallons.

National Farmers Union (NFU), a strong proponent of biofuels and the RFS, was disappointed with EPA’s proposal when it was first released and urged the agency to account for all 4 billion gallons worth of demand in the final rule. In a statement, NFU Vice President of Public Policy and Communications Rob Larew restated the organization’s mounting frustration with the administration’s destructive approach to biofuels policy:

“Family farmers are sick and tired of this biofuels bait and switch. Long before he was elected, President Trump promised to support the American ethanol industry, yet his EPA has done nothing but undermine its success. By indiscriminately granting so-called “hardship exemptions” to multi-billion-dollar oil corporations, this administration has cost hardworking family farmers billions of dollars in lost sales, eliminated thousands of jobs, and slowed economic growth in rural communities across the country.

“In response to farmers’ appropriate anger, President Trump made another promise to undo the needless damage caused by the EPA – yet another promise he hasn’t kept with today’s RVOs. This meager solution falls significantly short of the relief the biofuels industry needs to recover from three years of outright sabotage.

“How many more times must family farmers endure broken promises and disappointment? If this administration intends to make amends, it will not only compensate for all 4 billion gallons of demand lost to small refinery exemptions – it will also aggressively promote the widespread adoption of biofuels by replacing gasoline aromatics with ethanol and expanding the use of higher level blends of ethanol.”