Bill aims to clarify congressional intent on ‘extension’ of SREs

Reps. Randy Feenstra, R-Iowa, and Angie Craig, D-Minn., on July 2 introduced the Small Refinery Exemption Clarification Act of 2021, a bill that aims to clarify the definition of “extension” in response to the U.S. Supreme Court’s June 25 ruling on small refinery exemptions (SREs).

The Supreme Court on June 25 reversed the Tenth Circuit Court of Appeal’s Jan. 20, 2020, decision on SREs, ruling that the U.S. EPA can extend SREs to small refineries whose earlier temporary exemptions had lapsed. Arguments in the case focused primarily on congressional intent and how the Renewable Fuel Standard statute’s use of the word “extension” should be interpreted.

The legislation introduced by Feenstra and Craig aims to clarify congressional intent on the matter by limiting future SREs to refineries that have received a continuous exemption since 2011.

The bill is supported by the Iowa Renewable Fuels Association, Growth Energy, the Renewable Fuels Association, the National Corn Growers Association, and the National Farmers Union.

“We appreciate Representative Feenstra’s leadership and support of Iowa biofuels. This legislation will clarify how the RFS refinery exemption process was always intended to be implemented. We urge Congress to quickly pass this bill to once and for all end the abuse of refinery exemptions. The RFS is vital to Iowa farmers and they deserve certainty on this issue,” said Monte Shaw, executive director of the IRFA.

The Small Refinery Exemption Clarification Act seeks to correct a flaw in the small refinery exemption (SRE) program regarding who is eligible. The RFS always intended to blend more low-carbon biofuels into our domestic fuel supply every year. We firmly believe that refiners have had 16 years to adjust their operations to comply with the RFS, and that EPA’s SRE authority was meant to steer them toward compliance rather than provide a never-ending excuse to avoiding their blending obligations. Legislation like this will help stabilize demand in our industry, so we can continue to produce low-carbon biofuels, provide clean energy jobs in rural areas, and achieve our nation’s climate reduction goals. We are grateful to Representatives Randy Feenstra and Angie Craig for continuing to push to restore integrity to a program run amuck,” said Emily Skor, CEO of Growth Energy.

“As we argued before the Supreme Court, we believe Congress has always intended the small refinery exemption to be temporary in nature. We also continue to believe the statute only allows EPA to extend exemptions for refineries that were continuously exempt, but only if they can prove disproportionate economic hardship will be caused solely by RFS compliance,” said Geoff Cooper, president and CEO of RFA. “We strongly agreed with Justices Barrett, Kagan, and Sotomayor that ‘EPA cannot ‘extend’ an exemption that a refinery no longer has,’ but unfortunately their six colleagues didn’t see it that way. Thus, we applaud Representatives Feenstra and Craig for introducing this bill that would erase any lingering doubts about the intended meaning of ‘extension’ and clarify once and for all that exemptions were meant to be temporary.”