The National Biodiesel Board has filed the opening brief in a lawsuit objecting to the methodology EPA used for establishing the 2018 Renewable Fuel Standards (RFS).
NBB has three specific disputes with EPA’s final RFS rule for 2018, arguing:
– EPA must account for all small refinery exemptions in the annual percentage standard;
– The agency acted arbitrarily when it set the 2018 advanced biofuel volume below what it found to be “reasonably attainable;” and
– The agency set the 2019 biomass-based diesel volume based on impermissible considerations.
NBB’s brief is the first the courts will consider in arguing that EPA must account for all small refinery “hardship” exemptions – including retroactively granted exemptions – when it sets the annual RFS volumes and Renewable Volume Obligations (RVOs).
NBB’s brief states, “EPA unlawfully has failed to account for all small-refinery exemptions it awards, violating its duty to promulgate percentage standards that ‘ensure’ all aggregate volumes are met. Unaccounted for small-refinery exemptions reduce aggregate volumes, and EPA’s approach creates a new, de facto waiver authority contrary to Congress’s design. Despite knowing those consequences, EPA declines to adjust percentage standards to account for that shortfall, either before it is likely to happen or after it actually does.”
EPA has disclosed that it recently retroactively granted 48 small refinery hardship exemptions, reducing the 2016 and 2017 RVOs by a combined 2.25 billion RINs. In the brief, NBB notes that the exemptions reduced the 2016 RVOs by 4.3 percent and the 2017 RVOs by 7.5 percent. Separately, NBB estimates the 2016 and 2017 exemptions reduced demand for biodiesel by more than 300 million gallons. Every 100 million gallons of increased biodiesel production supports some 3,200 jobs. The small refinery hardship exemptions could put hundreds of new jobs at risk.
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