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NBB to EPA: Properly Account for Small Refinery Exemptions
USAgNet - 12/02/2019

The National Biodiesel Board (NBB) submitted comments on the Environmental Protection Agency's Supplemental Notice of Proposed Rulemaking for the 2020 Renewable Fuel Standards. NBB urges EPA "to properly account for small refinery exemptions, address the remand of the 2016 standards, and increase the 2021 biomass-based diesel volume."

NBB welcomes EPA's proposal to estimate 2020 and future small refinery exemptions in the formula for setting Renewable Volume Obligations (RVOs). In its comments, NBB calls it a positive and necessary step to ensure that future small refinery exemptions do not continue to destroy demand for biomass-based diesel. However, NBB points out that EPA's proposal falls short in several ways.

Kurt Kovarik, NBB's vice president for federal affairs, states, "On Oct. 4, President Trump, the EPA and USDA jointly pledged to account for small refinery exemptions in the RFS annual rule and ensure that the biomass-based diesel volume is met. On Oct. 15, however, EPA proposed action that would significantly underestimate future exemptions and fall short of ensuring that RVOs are met."

NBB encourages EPA to use the best possible estimate of future small refinery exemptions -- specifically, a three-year average of the gallons EPA actually exempted. "Unfortunately, the proposal uses an average of past exemptions recommended by the Department of Energy (DOE) rather than an average of actual volumes waived," NBB writes. "Because EPA has ignored DOE's recommendations in each of the past three years, that methodology would only account for about half of the annual impact of recent small refinery exemptions."

NBB also points out that EPA does not propose to do anything about small refinery exemptions before 2020. "Over 4 billion gallons of demand for biofuels has been lost due to retroactive small refinery exemptions for compliance years 2015 through 2018. This impact has been particularly significant for biomass-based diesel producers because biomass-based diesel RINs can be used to satisfy multiple obligations under the RFS," NBB writes. "Despite having the means to do so, EPA has not proposed to do anything in the Supplemental Notice to address this massive loss of renewable fuel demand."

In the comments filed today, NBB reiterates its requests that EPA raise the 2021 biomass-based diesel volumes and the 2020 RVOs to include the 500 million gallons the D.C. Circuit Court recognized (in ACE v EPA) were improperly waived in 2016. "Increasing the RVO by 500 million gallons would not only be achievable by BBD and other renewable fuels, it would assist in reviving production, reopening production facilities, and saving jobs," NBB writes. "The BBD industry can still achieve higher volumes if EPA properly accounts for small refinery exemptions and increases the renewable volume obligations and account for the ACE gallons."

Made from an increasingly diverse mix of resources such as recycled cooking oil, soybean oil and animal fats, biodiesel is a renewable, clean-burning diesel replacement that can be used in existing diesel engines without modification. It is the nation's first domestically produced, commercially available advanced biofuel. NBB is the U.S. trade association representing the entire biodiesel value chain, including producers, feedstock suppliers, and fuel distributors, as well as the U.S. renewable diesel industry.

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