U.S. EPA to decide on 2017 biofuel waivers within week

The U.S. Environmental Protection Agency will decide on the seven pending applications for small refinery waivers from the nation's biofuel laws for the 2017 calendar year in the next week, agency administrator Andrew Wheeler said.

Once the 2017 applications are decided, the EPA will consider at least 37 waiver applications submitted for 2018, Wheeler said during an energy industry summit. The EPA is expected to rule on all of the applications by March 30.

The EPA, under former administrator Scott Pruitt, greatly expanded the number of small refineries receiving waivers from the U.S. Renewable Fuel Standard (RFS), a law that requires refiners to blend biofuels like ethanol into the fuel pool or buy compliance credits from those who do.

The program has been an economic boom for corn farmers in the Midwest, but merchant refiners say the program has added hundreds of millions of dollars in compliance costs.

Small refineries with capacity of less than 75,000 barrels per day can apply for exemptions from the RFS if they can prove complying with the law would create a disproportionate economic hardship.

Previously, refineries had to prove that complying would hurt profits, but the EPA scrapped that part of the test in 2017, aiding the expansion and allowing oil majors like Exxon Mobil Corp and Chevron Corp to get exemptions, Reuters reported.

Refiners have until early 2019 to comply with all or a portion of the 2017 obligation.

The EPA has already granted 29 small refinery exemptions for 2017, up from 19 in 2016 and just seven in 2015. The EPA has yet to deny any application for 2017. 

The oil industry converges this week on Houston at CERAWeek, the largest gathering of top energy executives in the Americas, with oil majors showing a bigger presence as the United States has taken the crown as the largest crude producer in the world.

Both U.S. Secretary of State Mike Pompeo and Energy Secretary Rick Perry will speak at the conference.

Source: Reuters 

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