Oil companies and refiners called the Environmental Protection Agency (EPA) “out of touch with reality” after it denied a request by the American Petroleum Institute (API) and the American Fuel & Petrochemical Manufacturers (AFPM) to eliminate mandates for cellulosic biofuels.
“EPA’s mandate is out of touch with reality and forces refiners to pay a penalty for not using imaginary biofuels,” said API Director of Downstream and Industry Operations Bob Greco. “EPA’s unrealistic mandate is effectively an added tax on making gasoline.”
The Clean Air Act requires EPA to determine the mandated volume of cellulosic biofuels each year at “the projected volume available,” API said in a May 25 statement posted on its website. However, in 2011 EPA required refineries to use 6.6 million gallons of cellulosic biofuels even though EPA’s own records showed none were commercially available, API said.
EPA denied API’s 2011 petition for reconsideration of the mandate and continues to mandate the biofuels this year, API said.
“The fact that EPA continues to mandate these biofuels that do not exist is regulatory absurdity and bad public policy,” Greco said.
API represents more than 500 oil and natural gas companies.
AFPM, formerly the National Petrochemical & Refiners Association (NPRA) also criticized the mandate.
"EPA's decision is arbitrary and capricious. We fail to understand how EPA can maintain a requirement to purchase a type of fuel that simply doesn't exist. Congress created a waiver provision in the RFS to address this exact situation," AFPM President Charles T. Drevna said in a May 25 statement, after the EPA decision. "If EPA isn't going to grant a waiver based on the agency's own data that shows the fuel is not available, when does the agency think it is appropriate to exercise its waiver authority?” The ruling, Drevna said, “simply upholds EPA's imposition of a backdoor gasoline tax on American consumers."
The AFPM, API and the Western States Petroleum Association jointly filed a petition on January 20, 2012, requesting that the EPA waive the 2011 cellulosic biofuel volume mandate in its entirety due to a non-existent domestic supply of the fuel. EPA denied the petition on May 22, the groups said. The refiners said the agency's own monthly summary of available volumes of cellulosic
biofuels shows that no cellulosic biofuel was produced in the United States in 2011. Yet refiners were forced to pay $6.8 million to EPA for waiver credits needed to comply with the mandate, the trade groups said.
AFPM and API also sent a petition to EPA in February 2011 to reconsider the mandate. EPA denied that petition as well, the groups said.