Grassley discusses SRE gap filings, future of RFS program

By Erin Voegele | June 17, 2020

Sen. Chuck Grassley, R-Iowa, discussed issues related to the post-2022 Renewable Fuel Standard, retroactive small refinery exemptions (SREs), and COVID-19 relief for the ag community during a media call held June 16.

Grassley opened the call with a discussion of SRE petitions filed for past RFS compliance years that several oil refiners have reportedly filed in an effort to circumvent the Tenth Circuit Court of Appeal’s January ruling that determined the U.S. EPA cannot extend exemptions to any small refineries whose earlier, temporary exemptions had lapsed. Several oil refineries have reportedly filed these “gap year” SRE petitions in an effort to ensure access to future exemptions.

“The fact that the EPA doesn’t address these petitions by immediately dismissing them is a big concern of mine,” Grassley said, calling the petitions a blatant attempt by the oil industry and EPA to go around the Tenth Circuit Court decision. If the EPA does approve any of those gap year petitions, Grassley said those SREs will be challenged in court. He also said approval of the gap year petitions would risk President Trump’s support in Iowa and other Midwestern states. “This pattern of RFS abuse must end,” Grassley said. “Administrator [Andrew] Wheeler should publicly dismiss these ridiculous petitions as soon as possible.

He also briefly discussed the future of the RFS. In the legislation that established the current RFS program, Congress only provided mandated blend levels through 2022. After that time, the EPA is given more discretion in setting annual blending requirements.

During the call, Grassley was asked about the potential for RFS legislation that would provide a legislative fix for the program. He said it could be that by 2022 he has to take up RFS legislation whether he wants to or not. Grassley said he has been involved with past discussions with oil state senators who wanted to work out a compromise on the RFS. “I’ve kind of shied away from it,” Grassley said, noting changes to the program could be risky and harmful to ethanol. He said he hopes he doesn’t come to regret that reluctance in 2022 because there will likely be more pressure at that time to find a solution.

Grassley was also questioned on the timing of an additional COVID-19 relief package. He said he expects the Senate to take up another COVID-19 stimulus bill in July and pass it in early August before Congress goes into recess. He said official discussions related to the bill are being delayed as Congress waits to see how quickly the economy turns around, how unused money in prior COVID-19 relief bills could be diverted, and how states have spent money that has already been allocated to them. He indicated that Congress should have a better handle on what is needed in the future bill by mid-July.