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EPA’s 2019 RFS Proposal Missing an Opportunity to Set Things Right with America’s Farmers, Ethanol Producers

July 18, 2018


WASHINGTON--  The Renewable Fuels Association (RFA) implored the Environmental Protection Agency (EPA) today to use the 2019 Renewable Volume Obligation (RVO) rulemaking process to fix the extensive damage done to the Renewable Fuel Standard (RFS) by former Administrator Scott Pruitt. In testimony delivered at a public hearing today in Ypsilanti, Mich., RFA Vice President of Government Affairs Samantha Slater said EPA's 2019 RVO rule is an opportunity to correct the extensive damage done to demand for ethanol and America's farmers by Scott Pruitt's EPA. The EPA field hearing is part of the public comment process surrounding recently released 2019 RVOs, which called for 19.88 billion gallons (BG). Of that 19.88 BG, 4.88 BG is advanced biofuel, including 381 million gallons of cellulosic biofuel. That leaves, on paper, a 15 BG requirement for conventional renewable fuels like corn ethanol. "On the surface, the proposed rule raises the total 2019 RVO by 3 percent over the 2018 requirement, and maintains a 15-billion-gallon requirement for conventional biofuels like corn ethanol. But due to EPA's failure to stem the tide of small refinery waivers, its refusal to reallocate lost blending volumes, and its brazen repudiation of binding court decisions, the proposed rule is superficial and toothless, and undermines President Trump's commitment on the RFS," Slater testified. EPA recently approved 2.25 billion ethanol-equivalent gallons illegal waivers to oil refiners, and the agency has provided no commitment that it will change its approach to granting these exemptions, Slater explained. "Thus, the proposal means nothing until EPA reallocates those lost gallons and sets forth a more transparent and rational process that assures small refinery waivers are not abused or granted unnecessarily," she testified. As RFA outlined last week, interagency review documents show EPA had initially proposed to reallocate exempted renewable fuel volumes. However, after a lobbying push by the oil and gas industry, the EPA, then under the leadership of Scott Pruitt, reversed course just days before the 2019 RFS proposal was publicly issued. "Administrative cuts to the RFS have resulted in significantly lower RIN prices, reduced corn and ethanol demand, avoided legal obligations for highly profitable businesses, and provided windfall profits for certain oil refiners," Slater said. "The final rule should do less to cater to the whims of the oil industry in implementing the nation's renewable fuel program, and more to create demand for ethanol, lowering prices at the pump for consumers and creating economic opportunities for farmers across the country," she added. In her testimony, Slater urged to EPA to:   Adjust the 2019 RVO percentages to effectively reallocate projected small refiner exemptions;   Address the court-ordered remand and include a plan for restoring the 500 million gallons missing from the 2016 RVO;   Establish RVP parity for E15 and higher blends immediately; and,   Lay out a plan for reallocating the renewable fuel blending volumes lost to small refiner exemptions in the 2016, 2017, and 2018 compliance years. Slater's testimony, as prepared for delivery, is here.