Circuit Court Rejects Challenges to EPA’s Renewable Fuel Standards

WASHINGTON (CN) – The D.C. Circuit on Friday upheld the Environmental Protection Agency’s renewable fuel standards in the face of challenges from energy companies, biofuel producers and industry groups.

Aiming to cut greenhouse gas emissions, Congress in 2005 started requiring that renewable fuels be brought into the market to be mixed with traditional transportation fuel such as diesel and gasoline. Lawmakers tasked the EPA with setting standards for how much renewable fuel, such as biofuel, must be brought to market each year.

Under longstanding EPA policy, the burden of introducing more renewable fuel into the U.S. market falls on fuel refiners and importers, not on the companies that blend the renewables with fossil fuels.

The EPA reaffirmed that policy in 2010 and again in 2017. Refineries and related trade associations, led by Alon Refining Krotz Springs, brought a suit in 2016 challenging the agency’s decision not to revise this policy. 

In 2015, the EPA lowered the renewable fuel requirements for 2014, 2015 and 2016, after finding a lack of domestic supply. The agency again issued new standards for biofuels in 2017, dropping nearly 5 billion gallons from the required amount of renewable fuel. The agency separately increased the requirements for biomass diesel slightly.

Those changes drew legal challenges from a group of refineries, including Coffeyville Resources Refining & Marketing, which argued the EPA used flawed methodology and set the biofuel standards too high. The National Biodiesel Board similarly challenged the new rules, but said the EPA set the requirements for biomass diesel too low.

In a 70-page unsigned opinion released Friday, the D.C. Circuit beat back all of the challenges to the agency’s renewable fuel standards decisions.

Starting with the EPA’s policy that puts the obligation to meet the fuel requirements on refiners and importers, the three-judge panel found the agency based its decision on studies and other evidence that suggests the burden does not financially hurt the refiners. 

The panel also did not fault the agency for declining to reconsider its stance when petitioned to do so, finding the EPA has already grappled with the issue in the past.

As for the fuel requirements themselves, the court similarly found the EPA acted within its authority when setting the standards in 2017. The court said Coffeyville’s arguments were similar to those rejected in an earlier case and found the agency properly took into account input from the Energy Information Administration on the availability of biofuel.

The court rejected the National Biodiesel Board’s challenge, saying its arguments came down to “a policy disagreement.”

“A mere disagreement with the particular calibration of a line drawn in the exercise of an agency’s reasonable judgment is no basis to invalidate a rule,” the opinion states.

Paul Winters, director of public affairs and federal communications for the National Biodiesel Board, said the court’s decision did not grapple with key failings in the EPA’s methodology.  

“We are disappointed in the ruling, primarily because the court kind of failed to consider the obvious flaw in EPA’s arguments about how it sets the biomass diesel volume,” Winters said. 

An attorney for the refineries and industry groups did not immediately respond to a request for comment on the decision.

%d bloggers like this: