Factbox: Unresolved Biofuel Policy Issues Facing the Next U.S. President

November 04, 2020

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(Today/Reuters) Both U.S. President Donald Trump and his Democratic challenger Joe Biden have tried to clinch rural votes ahead of the election by voicing support for corn-based ethanol. But big questions remain over how either would administer the nation's biofuel law, the U.S. Renewable Fuel Standard (RFS), and the stakes are high for both the nation's farming and oil refining industries.

Here are the main issues:

A CORONAVIRUS WAIVER?

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After the coronavirus outbreak, U.S. fuel demand tanked and since has struggled to recover, leading the refining industry and its political backers to ask that the RFS requirements for 2020 be relaxed.

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NEXT YEAR'S OBLIGATIONS

The Trump administration has not yet set volumes for next year's biofuel blending mandates under the RFS, despite a looming Nov. 30 deadline, leaving refiners and biofuel producers alike uncertain about what to expect for 2021.

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A group of Republican senators in October asked the EPA to consider a general waiver that would prevent an increase in the 2021 mandate, again citing the pandemic's negative effect on refiners.

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SMALL REFINERY EXEMPTIONS

No issue has prompted more controversy this year around the RFS than the so-called small refinery exemptions, or SREs.

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Since Trump was elected in 2016, his administration has about quadrupled the number of waivers granted, igniting fury from farmers and biofuel producers who say the exemptions hurt demand for their products. The oil industry refutes that claim and says exemptions help refiners stay afloat.

In January, an appeals court handling a case initiated by the biofuel industry, ruled that waivers granted to small refineries after 2010 should only be approved as extensions. Most recipients of waivers in recent years have not continuously received them year after year.

Refiners have asked the Supreme Court to review the Tenth Circuit Court of Appeals' January decision.

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BEYOND 2022

The next administration will also have a heavy hand in deciding the future of the RFS.

Congress gave statutory volume targets through compliance year 2022, so the next administration's EPA will have more authority after that to set requirements. READ MORE

RFS, SRE Decisions Still Pending (DTN Progressive Farmer)

Ethanol Official Encouraged By New President’s Renewable Fuel Goals (WNAX)

Biden's oil plan: The good, the bad and the illegal (E&E News)

EPA should reduce or waive Renewable Fuel Standard in 2020 because of Covid and low demand (Daily Torch)

Next year's blending rates for renewable fuel is still up in the air (RFD TV)

Excerpt from RFD TV: "Comments this week from Administrator Wheeler have acknowledged that the November 30th statutory deadline for setting 2021 RFS blending volumes will be missed as they have not yet proposed the rule," Senator Chuck Grassley states. "In those same comments, Wheeler said that RIN prices were out of control. I do not know how he can say that, because that's not the case I see"

He says RIN prices are at a three year low. RINs are identification number oil companies use to prove they blended the right amount of biofuel in gasoline. Smaller retailers have argued RINs cost too much and gives larger retailers, that buy in bulk and blend themselves, an advantage. READ MORE