EPA to rule on biofuel waivers, but big oil refiners may need to wait

"President Donald Trump 's administration is expected to rule on a growing backlog of requests from small oil refiners seeking relief from U.S. biofuel laws as early as Friday, but will delay a decision on whether larger refiners must compensate by boosting their own biofuel blending, according to two sources familiar with the planning. The U.S. Environmental Protection Agency on Friday will announce decisions on some of the 195 pending small refinery exemption requests that date back as far as 2016, the sources said."

"The rulings will not be a sweeping win for small refiners, and will include some partial denials of waivers, according to one of the sources briefed on the decisions. The administration is also expected to issue a supplemental rule as early as next week to seek public comment on whether larger refiners should make up for the exempted gallons in a process known as reallocation, the source said."

"How the administration deals with exemption requests and the reallocation issues will have consequences for the oil and agricultural industries, and impact the price of commodities from gasoline and renewable diesel to soybeans and corn, along with the companies that produce them. In the past, widespread exemptions without reallocation have sent renewable blending credit prices lower, denting prices for corn-based ethanol and soybean-based biofuel."

EPA will issue decisions on a backlog of 195 small refinery exemption requests dating to 2016, granting some waivers and issuing partial denials. The administration will delay a final decision on whether larger refiners must compensate for exempted gallons and plans a supplemental rule to seek public comment on reallocation. Outcomes will affect oil and agricultural sectors and alter prices for gasoline, renewable diesel, corn, and soybeans. The Renewable Fuel Standard requires refiners to blend biofuels or use tradable RIN credits, and past exemptions without reallocation lowered RIN prices and hurt ethanol and biodiesel values.

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