Iowa officials urge EPA to account for SREs

By Erin Voegele | August 21, 2019

Iowa Gov. Kim Reynolds and Iowa Secretary of Agricultural Mike Naig sent a letter to U.S. EPA Administrator Andrew Wheeler Aug. 21 outlining the damaging effects of the agency’s recent approval of 31 small refinery exemptions (SREs) under the Renewable Fuel Standard.

“We write to express our profound disappointment in your agency’s recent approval of 31 new exemptions undermining the [RFS],” they wrote. “These actions are a clear violation of the President’s commitments to Iowa farmers and renewable energy producers across the heartland.”

Reynolds and Naig note the 31 SREs approved Aug. 9 destroyed 1.43 billion gallons of biofuel demand, which equates to more than 500 million bushels of corn. Over the past three years, SREs have undercut more than 4 billion gallons of demand “without transparency or accountability, even for so-called ‘small’ [SREs] offered to oil giants like Exxon and Chevron,” they wrote.

“The loss of these markets has taken a devastating toll on rural families facing one of the toughest years on record,” Reynolds and Naig wrote. “Ethanol consumption fell for the first time in 20 years, commodity markets are depressed, and many biofuel plants, including several in Iowa, have already slowed or halted production.”

Reynolds and Naig also note that the EPA failed to account for SREs in its proposed 2020 RFS rule. “We understand the agency is also working on a draft reset rule of the RFS, which could emerge any time this year,” they wrote. “That rule will ultimately raise or lower the bar for growth in homegrown energy from 2021 and all future years. This could block pathways for the adoption of advanced and cellulosic biofuels that transform farm waste into new rural revenue streams.”

The Iowa officials stress the EPA has offered their state no assurances to date that the reset will address its concerns over SREs or long-term growth. “That’s unacceptable, “Reynolds and Naig wrote. The EPA must repair the damage, reallocate lost gallons, and deliver on the economic opportunities President Trump promised to families in America’s heartland.”

The letter calls on the EPA to bring transparency to the SRE process and immediately reallocate gallons lost due to waivers that have already been granted. Reynolds and Naig also extended an open invitation for Wheeler visit Iowa and “see firsthand the devastating impact these exemptions are having on farm facilities, biofuels producers and rural communities.”

A full copy of the letter can be downloaded from Reynolds’ website.