OMAHA (DTN) — As the final days wane in a public comment period on the latest Renewable Fuel Standard proposal, indications are President Donald Trump is aware farmers and ethanol producers are unhappy with a proposal to account for gallons lost to small-refinery exemptions.
Sen. Charles Grassley, R-Iowa, during a press call with agriculture journalists on Tuesday, said he was in the Oval Office for a meeting on immigration with Trump and his advisers recently when the biofuels issue came up.
“It is a broken record,” Grassley said. “We were promised 15 billion gallons would be 15 billion gallons and that we would get it. (EPA Administrator Andrew) Wheeler was on the phone when I was in the Oval Office. I told Wheeler that he may [have] in very good conscience wrote a regulation to get 15 billion gallons, but farmers don’t have confidence in EPA and that the agency will need to take clear-cut action.”
At this point there’s no indication EPA will change the supplemental proposal to match the Sept. 12 agreement, or that the White House ordered such a change.
Reuters reported on Nov. 22 the White House asked for more information from Grassley’s office about how small-refinery exemptions affect the ethanol industry.
The agency has indicated it will likely finalize the 2020 volumes to include the supplemental proposal by end of this year.
The proposed rule calls for using a U.S. Department of Energy average estimate of gallons waived for 2020, or about 770 million gallons. Biofuels interests have maintained the president agreed to use an average of actual gallons waived between 2016 and 2018, or about 1.35 billion gallons. EPA granted 85 exemptions between 2016 and 2018, totaling about 4.04 billion gallons of biofuels not blended with petroleum.
This week a number of ethanol and agriculture groups filed public comments with EPA on the supplemental proposal, ahead of the Nov. 29 deadline.
The National Corn Growers Association said in public comments submitted this week that farmers have been asking the agency to uphold the RFS.
“EPA has an obligation under the law to keep the RFS volumes whole when granting waivers,” NCGA said.
“EPA has not met that obligation by waiving more than 4 billion gallons of renewable fuels blending in the past three compliance years. EPA also has the tools in the annual volume standards formula to account for waivers and offset waived gallons. Farmers have been asking EPA to uphold the law and give equal weight to the obligation to ensure volumes are met with EPA’s authority to grant waivers. EPA must use the 2020 and subsequent RFS volume rules to project waivers and accurately account for those volumes, regardless of whether the waivers have already been granted or are projected to be granted.”
The American Farm Bureau Federation questions the agency’s expansion of the waivers program since 2016, in its public comments on the proposal.
“These decisions have had significant impacts on struggling farmers, who have watched the demand for corn grown for ethanol drop as the renewable fuel volume obligations diminish with each exemption granted,” the AFBF said.
“It is alarming that the agency will continue down this path as farmers are facing extreme weather challenges, trade headwinds and a rural economy nearing its breaking point.”
In comments to EPA, American Coalition for Ethanol Chief Executive Officer Brian Jennings said his membership is concerned about the current proposal.
“ACE members are furious with EPA’s double standard,” Jennings writes.
“When it came to helping refineries escape RFS obligations, EPA rejected Department of Energy recommendations to exercise restraint, but now that EPA must restore volume to the RFS, the agency is suddenly embracing DOE recommendations because the result will keep a lid on refinery blending obligations going forward.”