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Court Strikes Down Three EPA Small Refinery Exemptions
USAgNet - 01/28/2020

In a decision that is expected to broadly impact the Environmental Protection Agency’s approach to granting Small Refinery Exemptions (SREs) under the Renewable Fuel Standard, the U.S. Court of Appeals for the Tenth Circuit late on Friday struck down three exemptions that were improperly issued by EPA.

The court ruling stems from a May 2018 challenge brought against EPA by the Renewable Fuels Association, the National Corn Growers Association, the American Coalition for Ethanol and National Farmers Union.

“We are extremely pleased with the Tenth Circuit’s decision to vacate the waivers granted by EPA to three refineries owned by CVR Energy and HollyFrontier,” said RFA President and CEO Geoff Cooper.

“The Court has affirmed our long-held position that EPA’s recent practices and policies regarding small refinery exemption extensions were completely unlawful.

"And while the decision addresses three specific exemptions, the statutory interpretation issues resolved by the court apply much more broadly.”

Among other findings, the Court held that EPA cannot “extend” exemptions to any small refineries whose earlier, temporary exemptions had lapsed.

According to the Court opinion, “the statute limits exemptions to situations involving ‘extensions,’ with the goal of forcing the market to accept escalating amounts of renewable fuels over time.

"None of the three small refineries here consistently received an exemption in the years preceding its petition.

The EPA exceeded its statutory authority in granting those petitions because there was nothing for the agency to ‘extend.’”

EPA’s own data show that a maximum of only seven small refineries could have received continuous extensions of their previously existing exemptions.


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