I suppose we should have seen this one coming. President Trump has thus far refused to consider ending the Renewable Fuel Standard and its mandates for blending ethanol into the gasoline supply. This keeps the King Corn folks in Iowa happy, but pretty much nobody else in conservative circles. Some compromises have finally been reached, however, and the EPA has begun granting a few waivers to refineries which were the hardest hit by the mandates and associated penalties. It wasn’t much, but it’s at least a start.
So how did the corn contingent respond? They’re suing the EPA, saying that the waivers are violating their iron grip on the market or something. (Politico)
Ethanol and farm groups say they’ve filed a lawsuit against EPA over some of the waivers granted to small refineries allowing them to shed their Renewable Fuel Standard requirements on blending biofuels, Pro’s Eric Wolff reports. The Renewable Fuels Association, National Corn Growers Association, American Coalition for Ethanol and National Farmers Union are challenging the waivers granted to CVR Refining’s Wynnewood, Okla., refinery and the HollyFrontier refineries at Cheyenne, Wyo. and Woods Cross, Utah. Those refineries have collectively saved $170 million in compliance costs, the coalition said.
This “coalition” is a real rogue’s gallery of political ethanol pushers so this reaction shouldn’t be taking us unawares. But what’s the basis for their complaint in the suit? The plaintiffs are saying that the waivers are a violation of the ethanol blending mandates. Okay… but isn’t that sort of the definition of what “waiver” means? When a policy is put in place and someone is exempted from it due to unavoidable, individual circumstances, that becomes baked into the regulatory cake.
Keep in mind that the refineries in question were not refusing to produce ethanol blended products because of some political motivation or principled choice to thumb their nose at the government. These are older, but still completely viable facilities which were built before the blending requirements existed. They don’t have the capability to blend as required and refitting them to do so would be ruinously expensive. So they wound up having to pay millions of dollars in RIN credits in order to be in compliance with the law. (Those are “Renewable Identification Numbers.”) That’s what bankrupted that one refinery in Pennsylvania.
Ideally, this entire RFS system should be scrapped, but until it is, the least we can do is offer some relief to those being financially ruined by it through no fault of their own. This lawsuit is a politically motivated disgrace.