In comments to EPA on the proposed E15 rule, the Iowa Renewable Fuels Association (IRFA) emphasized that keeping President Donald Trump’s promise for year-round E15 must not come at the cost of breaking his promise to protect the Renewable Fuel Standard (RFS).
The proposed rule coupled creating a legal path for year-round E15 sales with unrelated proposals to dramatically alter how RFS compliance credits, knows as RINS, would be regulated. IRFA Executive Director Monte Shaw emphasized that EPA would, if the good parts of the proposal are finalized, establish a reasonable, intellectually-consistent, legally-defensible solution for year-round E15 access.
“Loudly and clearly, I want to thank President Trump for directing the EPA to begin this process and to EPA leadership for including in this proposal many of the best pathways and justifications for allowing year-round E15 sales,” Shaw said.
However, the rule’s four proposals to radically alter RIN regulations would undermine the incentive to blend renewable fuels, thereby breaking Trump’s promise to protect the RFS. Shaw described one proposal that would put a time limit on how long retailers could hold RINs, essentially putting “a gun to the head of Iowa’s retailers” and forcing them to dispose of their RINs in a “fire sale.”
“If EPA adopts RIN procedures that eviscerate the value of RINs, as this proposal does, then the Agency has eviscerated the incentive to expand the use of renewable fuels, which is the main purpose of the RFS,” Shaw said. “With no actual market manipulation to address, this proposal reeks of a backdoor attempt to simply rip the heart out of the RFS.”
IRFA’s comments concluded by highlighting the damage small-refinery exemptions (SREs) inflict on the value of RINs and the effectiveness of the RFS. Shaw emphasized that with RINs sales recorded below 10 cents during large parts of the last seven months, “economic harm” exemptions from the RFS are clearly not justified.
“Given the current market circumstances, granting any of the pending 2018 SRE requests would fundamentally undermine the RFS and break President Trump’s promise to protect the 15-billion-gallon RVO for conventional ethanol in the RFS,” he said. “We urge the EPA to end RIN market manipulation via unjustified SREs and to put the RFS back on track by denying the 2018 SRE requests.”
To view IRFA’s full comments, click here.