Joe Biden Considers Exempting US Refineries from Biofuels Target. The issue confronts two important supporters of the current administration: refinery executives and farmers who depend on biofuels mandates to sustain a huge market for corn.
The impasse could cause a turnaround in the government, which had been reversing the expansion of exemptions to the Standard for Renewable Fuels (RFS) program, created by the previous president, Donald Trump.
In principle, the law requires refineries to mix billions of liters of ethanol and other renewable options into their fuel each year or to buy credits from those who do.
The credits, known as Renewables Identification Numbers (RINs), are currently at their highest price in the program’s 13-year history. Consequently, refiners argue that the RFS threatens to bankrupt fuel manufacturers already hit by the drop in demand seen during the pandemic.
The value of renewable fuel credits fell 15% on Friday morning after the news broke. They traded at $1.70 each, down from $2.00 on Thursday, traders said. Later, the papers were sold at US$ 1.85.
Democratic senators Chris Coons and Tom Carper of Delaware — Biden state — have had at least two meetings in recent weeks with US Environmental Protection Agency (EPA) head Michael Regan to discuss measures to help the refiners, according to the three sources.
Coons and Carper were trying to help the only refinery in the state, a plant with a production capacity of about 28,600 liters a day. These requests were added to a chorus of appeals from other states that own refineries, including Pennsylvania, Texas and Louisiana. It means means Joe Biden considers exempting US refineries from biofuels target
At the meetings, according to two of the sources consulted, Regan and the senators discussed options such as: a general national exemption from some obligations; reducing the number of renewable fuel plants in the future; the creation of a price cap for credits; and issuing a declaration of emergency.
EPA spokesman Nick Conger confirmed that Regan had met with senators but did not comment on the discussions or confirm whether the agency is looking for ways to provide relief to refiners.
Coons did not respond to requests for comment. A Carper spokesman said the senator spoke with Regan several times about the high costs of RINs. It help us to understand that Joe Biden considers exempting US refineries from biofuels target
Refineries like PBF Energy, which operates the plant in Delaware, said biofuel laws could close factories and wipe out thousands of unionized jobs.
The company recently closed most of its refinery in New Jersey after the latest in a series of shutdowns along the east coast of the United States.
The region, which faces higher refining costs because of its distance from oil fields, has seen fuel production capacity drop by about 40% since 2000.
Federal data show that only eight of the 17 refineries operating on the US East Coast in 2000 are still operating.
In addition, at least one company is already betting that the government will end up helping the refineries. Reuters previously reported that Delta Air Lines Inc stopped purchasing RINs, leaving its refinery in Pennsylvania with a liability of $346 million at the end of the first quarter of 2021. So this situation show us Joe Biden considers exempting US refineries from biofuels target