EPA delivers win for ethanol industry angered by waivers to refiners

The Trump administration extended an olive branch to the ethanol industry Monday, announcing it has denied a number of waivers that exempt small refiners from adding the biofuel to their gasoline.

The news comes after the Environmental Protection Agency (EPA) chose not to challenge a 10th Circuit Court of Appeals decision that found its economic hardship waiver program shortcut national goals for ethanol use. 

The decision is a win for an industry that was hit hard by Trump’s trade war with China and has been in stiff competition with refiners to secure favorable policies from the administration.

The decision from the EPA rejects 54 so-called “gap-year” petitions that allowed refiners to skip blending in ethanol between 2011 and 2018, though another 14 are still under consideration. The EPA found the applicants did not make a sufficient economic case for needing a break.

“Rejecting the petitions is simply the right thing to do, and today’s decision marks a big step forward toward fully restoring integrity to the Renewable Fuel Standard. This should serve as the final nail in the coffin of these gap-year petitions, and we are eager to put this dark and sordid chapter in the history of the RFS behind us once and for all,” the Renewable Fuels Association, which represents ethanol producers, said in a statement.

“EPA is correct that these refineries ‘do not warrant an exemption.’”

The Trump administration has ping-ponged back and forth between upsetting refiners and the corn and ethanol producers, both of which he considers part of his base.

Tensions between the two industries arose in 2019 after EPA approved more than 80 waivers for refiners.

The Renewable Fuels Association sued, which prompted the latest round of waivers EPA is now rejecting.

“The notion that this administration is ‘following the rule of law’ through its latest betrayal of U.S. refinery workers is laughable. We hope the President and Administrator [Andrew] Wheeler feel a sense of responsibility when RFS compliance costs become even more untenable for refineries of all sizes. The legacy of this Administration’s handling of RFS will be fewer union refining jobs, facility closures, reduced U.S. refining capacity, and increased imports of foreign biodiesel’,” the Association of Fuel and Petrochemical Manufacturers said in a release.

“Telling ethanol interests everything they want to hear in a press release is not going to increase the amount of ethanol that gasoline can absorb.”

Trump’s ethanol policy has made him a punching bag for Democrats across the Midwest.

“Today’s decision by the EPA to reject dozens of pending petitions for small refinery exemptions should have been made years ago — before the Administration gave 85 exemptions to oil companies. They shouldn’t be celebrated for deciding not to further worsen the economic challenges our rural communities are currently facing,” Sen. Amy Klobuchar (D-Minn.) said in a release.