Brown Urges President to Help Rural Americans by Upholding the Intent of the Renewable Fuel Standard

Small Refinery Biofuel Waivers Are Benefiting Profitable Oil Companies at the Expense of Farmers, Rural Communities

WASHINGTON – U.S. Senator Sherrod Brown (D-OH) joined his Senate colleagues this week in writing a letter to President Donald Trump, strongly urging him to help rural Americans, and the environment, by rescinding the 31 recently approved small refinery exemptions (SRE) for biofuels. They also urged his administration to uphold the intent of the Renewable Fuel Standard (RFS). The letter follows recent news reports indicating that the Administration is considering changes to the RFS that would boost biofuel volumes following backlash from farmers after 31 additional SREs were approved on August 8. SREs, or so-called “hardship” waivers, are intended to help small refineries by exempting them from the RFS, but the EPA has issued dozens of waivers, including for some of the most profitable oil companies in the world.

“In recent months, the biofuels industry has seen an increase in the number of plant closures, and many other plants are beginning to reduce overall production, resulting in thousands of lost jobs in rural communities and lost markets for farmers at a time when they are already struggling with low commodity prices and ongoing trade disputes. We have previously expressed our serious concerns to the EPA about the impact of your Administration’s policies on the rural economy as a result of the improper issuance of SREs. Since that time, the approval of additional SREs and the worsening economic conditions facing biofuel producers and farmers have only exacerbated those concerns,” the senators wrote.

The Senators continued, “The EPA’s continued issuance of SREs is undermining the statutory intent of the RFS to the detriment of rural communities and farmers. It is for this reason that we ask you to ensure that any plan negotiated with the EPA and USDA rescinds the 31 recently granted SREs and upholds the intent of the RFS by accounting for future SREs in the calculation of the 2020 RVOs.”

The abuse of these waivers has resulted in lost jobs in rural communities and lost markets for farmers at a time when they are already struggling with low commodity prices and ongoing trade disputes. Under the Trump Administration, 85 SREs have been approved, contributing to a reduction in the use of billions of gallons of renewable fuel.

Biofuels are a key pathway toward decarbonizing the transportation sector while lowering gas prices, driving economic growth, and creating jobs. Every gallon of biofuels we use displaces a gallon of oil and cuts carbon emissions. The U.S. Department of Agriculture (USDA) found that first generation biofuels cut greenhouse gas emissions by between 39 and 43 percent.

The letter was led by Senators Amy Klobuchar (MN) and Tammy Duckworth (D-IL). Brown was a co-signer, along with Senators Debbie Stabenow (D-MI), Tina Smith (D-MN), Dick Durbin (D-IL), Ron Wyden (D-OR), Gary Peters (D-MI) and Tammy Baldwin (D-WI).

The full text of today’s letter can be found below and here:

Dear Mr. President:

We understand that your Administration has convened meetings to consider proposals related to the Renewable Fuel Standard (RFS) and the continued issuance of small refinery exemptions (SRE), based on recent reports. As you continue to deliberate on a final package, we strongly urge you to rescind the 31 SREs that were approved on August 8, 2019, and to prospectively account for any future SREs when calculating Renewable Volume Obligations (RVO) for 2020.

For the compliance years of 2016, 2017, and 2018, the EPA has approved 85 SREs, all of which have contributed to a reduction of over 4 billion gallons of renewable fuel blending volumes and 1.4 billion bushels of corn. The abuse of SRE authority by the EPA is negatively impacting the rural economy, and the consequences resulting from the continued misuse of these exemptions are becoming more apparent by the day.

In recent months, the biofuels industry has seen an increase in the number of plant closures, and many other plants are beginning to reduce overall production, resulting in lost jobs in rural communities and lost markets for farmers at a time when they are already struggling with low commodity prices and ongoing trade disputes. We have previously expressed our serious concerns to the EPA about the impact of your Administration’s policies on the rural economy as a result of the improper issuance of SREs. Since that time, the approval of additional SREs and the worsening economic conditions facing biofuel producers and farmers have only exacerbated those concerns.

According to reports, the latest proposal under discussion would increase blending requirements for some categories of renewable fuels including biodiesel, but would fail to rescind the recently granted SREs and delay the reallocation of prospective exemptions until the 2021 compliance year. 

The EPA’s continued issuance of SREs is undermining the statutory intent of the RFS to the detriment of rural communities and farmers. It is for this reason that we ask you to ensure that any plan negotiated with the EPA and USDA rescinds the 31 recently granted SREs and upholds the intent of the RFS by accounting for future SREs in the calculation of the 2020 RVOs.

Thank you for your attention to this issue.

Sincerely,

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