The National Biodiesel Board is responding to the latest court ruling on the Renewable Fuel Standard. Here is how it will impact the industry.
Refiners and the biofuel industry both faced losses in the last U.S. circuit court decision on the Renewable Fuel Standard.
National Biodiesel Board VP for Federal Affairs, Kurt Kovarik says that the ruling sends a strong signal to refiners.
“The good news is, the court, once again, kind of flatly denied and rebuked the refiners and their arguments, both on a waiver for severe economic harm, essentially saying that the compliance costs for the RFS are not borne by refiners,” Kovarik states.
However, the court also did not hand a victory to biofuels advocates.
“Where we were disappointed is that the court again said that EPA has deference in terms of how to account for small refinery exemptions, so while this court challenge, the court decision didn’t come down on our side. It also doesn’t mean that the EPA needs to do what the refiners have been claiming,” Kovarik explains.
He says that the decision reaffirms the previous ruling from the 10th Circuit Court: “I think in both cases, the overriding conclusion is that it’s still very much in EPA hands to determine how to implement the program and small refinery exemptions. Both courts gave a lot of deferences to EPA and how to do it. However, there were three components of the litigation in the 10th Circuit, the Supreme Court only took up one of those prongs of that of that case; the other two still stand.”
The current EPA administration has already included an estimate of waived gallons for the 2020 Renewable Volume Obligation, which gives Kovarik some optimism moving forward.
“I have no doubt that this EPA will essentially correct the core set of the previous EPA and first, probably grant a lot fewer small refinery exemptions, and then for those that are granted account for those wave gallons,” he adds.
Several lawmakers have offered up legislation, in response to the series of court rulings on RFS, but Kovarik says that he is cautious of any unintended consequences and thinks the RFS can work if administered properly.
Related:
Biofuel groups lose case against EPA over retroactive RFS waivers