Trump Plans to Appeal Ruling that Imperils Refinery Biofuel Waivers

by Jennifer A. Dlouhy and Mario Parker (Bloomberg News/The Eagle) President Donald Trump has decided to appeal a federal court ruling that jeopardized the U.S. government’s ability to widely exempt refineries from requirements to use renewable fuels.

The decision follows an intense pressure campaign by oil-state senators, including Ted Cruz, a Texas Republican. The plan was described by four people familiar with the matter who asked for anonymity before a formal announcement.

The appeal plan would mark a reversal for the White House, where top officials as recently as a week and a half ago had planned to accept the ruling and apply it nationwide. That approach would have meant just a handful of U.S. refineries — no more than seven — would be eligible for the exemptions.

But this move would be a victory for oil companies and their allies on Capitol Hill, who argued the waivers are essential to preserve the economic health of refineries and blue-collar jobs at the facilities. They have raised the specter of layoffs and plant closures in Wyoming, Texas and the political battleground state of Pennsylvania — warning the White House in recent days that if the administration backed down, there could be repercussions for the president on Election Day in November.

At issue is a January decision by a three-judge panel of the 10th Circuit Court of Appeals in Denver invalidating waivers exempting three refineries from requirements compelling the use of corn-based ethanol and soybean-based biodiesel.

The judges said the federal law mandating biofuel limits waivers to situations involving “extensions” and pointed out that none of the three refineries at issue had “consistently received an exemption” in previous years. READ MORE

Excerpt from AgWired: Biofuel and agricultural organizations are up in arms over news reports out late Thursday saying President Trump is now planning to appeal the 10th Circuit Court decision regarding EPA’s granting of Small Refinery Exemptions (SREs).

The National Corn Growers Association, Renewable Fuels Association, American Soybean Association, National Farmers Union, Growth Energy, American Coalition for Ethanol, National Biodiesel Board, Iowa Renewable Fuels Association, and Fuels America issued a joint statement regarding the news reports:

“The president needs to understand that Ted Cruz doesn’t care about this administration or families across the heartland who are counting on the White House to keep its promises. Just days ago, thousands of farmers rallied behind Secretary Perdue, who expressed his confidence that we had finally reached the end of a long and painful fight against EPA demand destruction. Tearing open that wound, against the advice of rural champions and the president’s own advisors, would be viewed as a stunning betrayal of America’s rural workers and farmers. We cannot stress enough how important this decision is to the future of the rural economy and to President Trump’s relationship with leaders and voters across the heartland. Ted Cruz comes back year after year with the same lies about refinery profits, disproven over and over by economists, the EPA, and even by Big Oil. We urge the president to stand up now against this misguided effort to torpedo the rural recovery.”

Earlier this week, Agriculture Secretary Sonny Perdue said USDA legal counsel believes the case is solid and he doesn’t “think it would be worthwhile for the U.S. government to appeal that and I hope we won’t.” READ MORE

Excerpt from Iowa AgriBusiness Radio Network: Jim Talent is a former Missouri Republican Senator and one of the authors of the RFS. He is now a Co-Chair of Americans for Energy Security and Innovation. Talent says the Trump Administration is making, “another unforced error.” He says the authors of the RFS never could have anticipated exemptions would be used in such a way that would destroy ten percent of demand.

At the center of this debate is Senator Ted Cruz (R-TX). He has long been an unapologetic supporter of the oil industry in Texas. Many times, he has attacked the RFS and even held up USDA appointments because of it. Talent says the President needs to stop listening to Cruz on matters which affect the President’s support in the Midwestern states.

Talent talks about the intentions of the exemptions that were allowed for in the RFS. He says the law was never written to exempt refineries at the level the Trump Administration has been exempting them.

President Trump really relied on the support he received in rural America during the 2016 elections. It is the support he says is reciprocal when he talks about the farmers and the agriculture and biofuels industry. However, so many broken agreements and promises have soured the biofuels industry over the past few months. Not since the May 2019 rollout of year year-round E15 sales has the biofuels industry seen a win.

We all know about the shuttering or slowing of production in plants across Iowa and across the country. The plants looked to an Oval Office agreement as the stability they would need to bring operations back online and to full capacity. However, when the EPA changed course and altered their end of the bargain only a few days later, it made supporters scratch their heads and ask, “Where is President Trump? The President ordered the EPA to make E15 available year-round, but he cannot hold their feet to the fire and tell them to live up to their agreement in October?” Supporters are trying to find out where the President’s authority over the EPA, or at the very least, his willingness to exercise his authority over the EPA ends.

The President’s decision on whether to fully support this appeal could erode his support from the biofuels industry and midwestern farmers. Farmers who have been both sides of the argument on the trade wars, farmers who needed to get government backing to keep operating because of trade disputes but would rather have just had trade. Many farmers kept their support for the Administration during the trade wars because they felt they also had an ear in the White House that was listening to them and not trying to micromanage how they ran their businesses and livelihoods.

However, this is not trade. This is a completely different subject, with different outcomes for farmers. Producers rely on the success of the biofuels industry. An industry that helps drive demand for their corn and soybean production. Jim Talent says it is not unreasonable to think that a Trump Administration which openly backs the EPA in the illegal use of SRE’s, could face additional scrutiny from rural America during the elections of 2020. READ MORE