Court ruling yields mixed results for US biodiesel industry

The National Biodiesel Board expressed disappointment in a court ruling that upholds the U.S. EPA’s method for setting biomass-based diesel volumes in the 2017 Renewable Fuel Standard rules. The U.S. Court of Appeals for the D.C. Circuit dismissed NBB's petition as a policy disagreement with EPA’s choice of biomass-based diesel volumes.

In the same decision, the court rejects refiners’ arguments that they are burdened by RIN prices and that EPA should change the point of obligation. The court further rejected arguments that the 2017 RFS volumes were set too high and that EPA should have used additional waiver authority.

“The court’s decision is disappointing,” said Kurt Kovarik, NBB vice president of federal affairs. “It fails to consider the obvious flaw in EPA’s choice of biomass-based diesel volumes for 2018, which was set a year in advance of the other annual volumes. The court found persuasive EPA’s promise to allow growth for biodiesel and renewable diesel under the yet-to-be-set 2018 advanced biofuel. However, as we argued was the danger, EPA did not provide that growth—it flatlined the advanced biofuel volume in 2018.”

Nevertheless, NBB sees one bright spot in the Aug. 30 court decision. “The court agreed with EPA’s evidence that refiners are not harmed by the cost of RINs,” Kovarik said. “The court’s ruling highlights the disparity between EPA’s findings and its current practice of granting hardship exemptions to every refinery that asks. If the refiners aren’t harmed by RIN costs, what exactly is the hardship they’re facing? EPA’s small refinery exemptions have caused severe economic hardships for biodiesel and renewable diesel producers, forcing some to close their doors and lay off workers. EPA must put the RFS program back on track.”