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NBB Welcomes Proposed Limit on RFS Refinery Exemptions
Minnesota Ag Connection - 05/24/2019

The National Biodiesel Board thanked House Committee on Agriculture Chairman Collin Peterson (D-MN), and Reps. Dusty Johnson (R-SD), Dave Loebsack (D-IA), Rodney Davis (R-IL), and Roger Marshall (R-KS) for introducing the bipartisan Renewable Fuel Standard Integrity Act of 2019. The legislation would require small refineries to petition for Renewable Fuel Standard (RFS) hardship exemptions by June 1 each year. The change would ensure that the Environmental Protection Agency (EPA) properly accounts for exempted gallons in the annual Renewable Volume Obligations (RVOs) it sets each November.

"NBB and its members appreciate Representative Peterson's legislative solution to EPA's recent flood of small refinery exemptions. This is just one of the many things EPA could do on its own to ensure that the RFS volumes it sets each year are met and the market for biodiesel and renewable diesel remains open," said Kurt Kovarik, NBB's Vice President of Federal Affairs.

"EPA's retroactive small refinery exemptions destroyed demand for more than 360 million gallons of biodiesel and renewable diesel over the past sixteen months. EPA is right now preparing to grant another flood of retroactive exemptions, which will further undercut use of advanced biofuels for the rest of 2019 and into the future. The legislation would prevent further economic harm to U.S. biodiesel producers and soybean growers. NBB and its members will continue to ask EPA to restore that lost demand and ensure that annual RFS volumes are met with actual renewable fuel use."

Over the past two years, EPA retroactively granted RFS hardship exemptions to nearly every refiner that petitioned. The retroactive exemptions reduced RFS RVOs for 2015, 2016, and 2017. NBB conservatively estimates the demand destruction at 364 million gallons of biomass-based diesel. University of Illinois Economist Scott Irwin estimates the economic harm to U.S. biodiesel producers at $7.7 billion.

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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