The Environmental Protection Agency (EPA) today proposed denying a petition to change the point of obligation under the Renewable Fuel Standard (RFS).

Under the current rule, oil refiners and importers are the entities obligated to blend more renewable fuel into the transportation fuel supply under the RFS, but they were seeking to change that obligation to entities that own gasoline before it is blended for retail sale. However, EPA said in response to the petition that because of “the importance, complexity, and broad stakeholder interest in this issue” there will be a 60-day comment period for interested parties to offer their comments.

Tom Buis with Growth Energy says what the refiners are trying to do is shift the obligation to retailers and others. “It makes no sense. We’ve been operating under this system since the first RFS in 2005…Some refiners made the business decision they weren’t going to blend, they were going to just buy the identification numbers.”

That worked well for them when RINs were cheap but Buis says as more ethanol entered the marketplace RIN prices have increased. “Now they want to change the point of obligation all for their bottom line.” Statement from Tom Buis, Growth Energy

Renewable Fuels Association (RFA) President and CEO Bob Dinneen explains that the petition was submitted by Valero who wants the point of obligation to be at the terminal. The EPA has not wanted to do this. “It’s a complicated issue,”says Dinneen. “So the petition forced the EPA into opening a docket.”

“The agency is denying that petition but at the same time they are opening a docket. So they are doing what Valero had wanted them to do but on their own terms,” added Dinneen who says they support what EPA is doing and is calling for all stakeholders to come to the table. Statement from RFA CEO Bob Dinneen