The National Biodiesel Board (NBB) today strongly opposed petitions from five state governors to waive 2020 Renewable Fuel Standard volumes. The petitions were submitted by Govs. John Bel Edwards (D-LA), Greg Abbott (R-TX), Gary Herbert (R-UT), Kevin Stitt (R-OK), and Mark Gordon (R-WY). A waiver of RFS volumes set more than a year in advance would severely harm the biodiesel industry. Texas and Louisiana are two of the top states in producing biodiesel and renewable diesel; an RFS waiver would particularly hurt tens of thousands of workers in the two states.
Kurt Kovarik, NBB’s VP of Federal Affairs, said, “NBB and its members condemn the oil industry’s attempt to use the current national emergency as an excuse to undermine the RFS. The waiver sought by the oil state governors would devastate renewable fuel producers, cost essential critical infrastructure jobs in multiple states, reduce incomes for soybean farmers, and lead to dirtier air and higher carbon emissions.
“EPA long ago established that waiver petitions must demonstrate that the RFS is the direct cause of severe economic harm. Federal courts have upheld that interpretation. The refining sector’s current economic challenges stem from state and federal stay-at-home orders related to COVID-19 along with the international crude oil price war; they have nothing to do with the RFS.
“The fact is the decline in transportation fuel demand hurts refiners and biofuel producers equally. Refiners’ RFS obligations are set as a percentage of the fossil fuel they produce or import, which means that lower fuel demand directly reduces the amount of renewable fuel they blend. Additionally, EPA has consistently demonstrated that refiners recoup the costs of any credits they purchase.”
Waiving the RFS requirements for 2020 would be particularly devastating to biodiesel and renewable diesel producers. EPA sets the biomass-based diesel volume requirement more than a year in advance to give all stakeholders time to plan and invest. Now that EPA has translated the volume requirements into the annual percentage obligation, a waiver would provide little additional benefit to refiners but undercut the investments and plans of biodiesel producers.
An RFS waiver would be particularly harmful to the economies of Texas and Louisiana in addition to those of Midwest states. Nationwide, the biodiesel industry supports more than 60,000 jobs and $17 billion in economic activity. With more than 20 percent of the nation’s biomass-based diesel production capacity, Texas and Louisiana reap significant benefits from producing and using these fuels. A waiver would cost jobs and economic investment in the two states.