OKLAHOMA CITY — The U.S. Court of Appeals for the Tenth Circuit has struck down three exemptions that were improperly issued by the Environmental Protection Agency (EPA). The court ruling stems from a May 2018 challenge brought against EPA by the Renewable Fuels Association (RFA), the National Corn Growers Association (NCGA), the American Coalition for Ethanol (ACE) and National Farmers Union (NFU).
“AFR/OFU applauds the Tenth Circuit Court’s decision to strike down improperly awarded small refinery exemptions,” said AFR/OFU Cooperative President Scott Blubaugh. “We fully support NFU’s involvement in the challenge and celebrate its victory.
“Oklahoma’s corn and sorghum growers have been operating below cost of production for some time. It is our hope that this decision creates a more dynamic marketplace for producers—that it will increase demand and signal a boost in price corn and sorghum growers so desperately need.”
Agricultural organizations nationwide have also signaled hope that the Court’s decision will send a resoundingly positive signal to the marketplace at a time when it is desperately needed.
“This ruling comes at a critical time for America’s farmers and the biofuels industry,” said NFU President Roger Johnson. “Due in large part to EPA’s rampant and ongoing abuse of the SRE program, 2019 was one of the most challenging years in history for the agriculture and biofuel sectors. We believe this ruling will help restore the ability of the RFS to drive demand and expand markets for renewable fuels, as Congress intended, providing a badly needed shot in the arm for rural America.”
In addition to marketplace changes, the decision is expected to significantly impact EPA’s approach to granting small refinery exemptions (SREs) under the Renewable Fuel Standard (RFS).
Among other findings, the Court held that EPA cannot “extend” exemptions to any small refinery that has had a temporary exemption lapse. EPA’s own data showed that a maximum of only seven small refineries qualified for continuous extensions; yet, EPA has granted as many as 35 exemptions in a single year.
The Court also found that EPA “abused its discretion” in failing to explain how its conclusion that a small refinery might suffer a disproportionate economic hardship when EPA has simultaneously and consistently maintained that costs for RFS compliance credits, or RINs, are passed through and recovered by those same refineries.
AFR/OFU Cooperative is a membership services organization established in 1905 as Oklahoma Farmers Union. AFR/OFU provides educational, legislative and cooperative programs across the state and serves as a watchdog for Oklahoma’s family farmers and ranchers and rural communities. The organization is actively supportive of the state’s agricultural industry and rural population with membership consisting of farmers actively involved in production agriculture and non-farmers adding their voice in support of AFR/OFU principles.
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