Farm Groups Back EPA Refinery Exemption Move but Urge Full Reallocation

On Friday, the Environmental Protection Agency (EPA) issued decisions involving 175 petitions for small refinery exemptions (SREs) from the Renewable Fuel Standard (RFS) for 2016-2024. 

EPA granted full exemptions to 63 petitions and partial exemptions to 77 petitions. The rest were denied or deemed ineligible.

Farm and biofuel groups were quick to react to this step by the agency. Most were pleased by the move and all called for further action. Here’s a closer look.

American Farm Bureau Federation

The American Farm Bureau Federation (AFBF) is the nation’s largest farmer-run organization and serves farmers in all 50 states.

On Friday, AFBF President Zippy Duvall commented on the announcement. 

“Renewable fuels have been a tremendous success story for the country and the rural economy. The RFS has reduced our country’s dependence on foreign oil, reduced air pollution, increased farm income, and provided good-paying jobs in rural America.

“Farmers rely on a robust renewable fuel standard with strong renewable volume obligations that further build the biofuels market. EPA’s measured approach will prevent overuse of small refinery exemptions that would risk undermining the RFS and the biofuels market for farmers.

“With the proposed RFS rule increasing domestic fuel production and prioritizing home-grown crops, we urge EPA to build on this momentum in its reallocation guidance by ensuring the volume lost to exemptions is replaced. Supporting a robust biofuels market allows our country to reduce fuel prices and move closer to energy independence.”

Growth Energy

As the nation’s largest biofuel trade association, Growth Energy is the leading voice of America’s biofuel industry. Members of the association operate and support biomanufacturing facilities at the heart of America’s bioeconomy, delivering a new generation of plant-based energy and climate solutions.

The association published a statement Friday in response to EPA’s announcement.

“With more than 140 granted refinery exemptions, today’s [SRE] decision alone does not give farmers and biofuel producers the certainty they need,” said Growth Energy CEO Emily Skor. “It is imperative that EPA reallocates each and every exempt gallon in a forthcoming rule to mitigate the potentially devastating impact on biofuel demand. We appreciate EPA’s commitment to issue a rule that ensures promised homegrown biofuel gallons reach the marketplace and upholds the administration’s commitment to American energy dominance.”

Iowa Renewable Fuels Association

Formed in 2002, the Iowa Renewable Fuels Association (IRFA) brings together Iowa ethanol and biodiesel producers to foster the development and growth of the state’s biofuels industry through education, promotion, and infrastructure development.

On Friday, IRFA released a statement applauding the move by EPA.

“We must get RFS refinery waiver uncertainty out of the market, and today’s action by EPA takes a big step forward,” said IRFA Executive Director Monte Shaw. “While we can quibble with the justification of the SREs granted, the EPA was spot-on in reissuing the same retired RFS credits back to the refiners who received an exemption. This is consistent with past actions when the shoe was on the other foot and is in line with the overall goals of the RFS.”

“One absolutely vital question remains: how or if the SREs from 2023 to 2025 will be reallocated,” Shaw continued. “That is a two-billion-gallon uncertainty hanging over the market and the pending RFS blending rule for 2026 and 2027.” 

“Full and complete reallocation of the 2023 and newer SREs is the vital point,” stated Shaw. “In the end, that will determine whether the EPA upholds President Trump’s commitment to the RFS and to American farmers. If true reallocation does not occur, then EPA is effectively reducing the already low RFS blending levels for 2025. IRFA was heartened by EPA’s announcement today that it will propose reallocating the exempted volumes. We now anxiously await EPA’s reallocation proposal, at which time we will be commenting in the strongest possible terms that reallocation of every SRE gallon must occur, and we will implore the EPA to end the SRE uncertainty before finalizing the 2026-2027 RFS rule.”

National Corn Growers Association

Founded in 1957, the National Corn Growers Association (NCGA) represents more than 36,000 dues-paying corn growers in 48 states, and the interests of more than 300,000 farmers who contribute through corn checkoff programs in their state.

After EPA’s announcement Friday, Illinois farmer and NCGA President Kenneth Hartman Jr. released a statement, calling the announcement an “important step toward resolving a stubborn issue that has lingered without resolution for too many years.”

“With government reports projecting record high corn yields this year, we continue to focus on corn demand, including increasing ethanol sales,” Hartman said. “We want to see the RFS continue to be implemented as it was intended, and we want to extend year-round, nationwide consumer access to 15% ethanol fuel blends through the summer months. Both will ensure greater energy security and lower gas prices for consumers.”

Renewable Fuels Association

Since 1981, the Renewable Fuels Association (RFA) has been the leading trade association for America’s ethanol industry.

RFA President and CEO Geoff Cooper offered the following statement in response to the announcement:

“While RFA continues to doubt that the small refineries receiving exemptions today truly experienced ‘disproportionate economic hardship’ due to the RFS, we are pleased to see EPA taking an approach to implementation of these exemptions that is minimally disruptive to the marketplace and affirms the agency’s intent to reallocate renewable fuel volumes lost to SREs. We appreciate that EPA is focused on an approach that maintains stability in the marketplace and ensures finalized annual volumes under the RFS are maintained. The exemptions granted today should have little or no effect on current and future levels of renewable fuel production and use. It is critical, however, that the renewable fuel blending volumes associated with SREs for 2023 and 2024 are fully reallocated.

“In the days ahead, RFA will be further analyzing EPA’s new approach and rationale for determining disproportionate economic hardship. According to EPA’s previous analysis, all refiners — both small and large — recoup their RIN costs when they sell gasoline and diesel. Thus, there is no credible evidence that small refiners are disproportionately affected by RFS compliance, or that the financial impact of RFS compliance rises to a level anywhere close to ‘economic hardship.’ In any case, SREs were always intended to be a temporary measure and a bridge to compliance — not a permanent handout. Small refiners have now had two full decades to adapt their operations to comply with the RFS.”

Editor’s note: Some of the previous statements have been edited and/or condensed by Successful Farming for style and clarity.