Almost as soon as the EPA set the biofuel targets for the new year, Texas Gov. Greg Abbott requested a waiver that would exempt one-fourth of U.S. refining capacity from the Renewable Fuel Standard for the coming year, reports Argus Media. Meanwhile, the White House was reported to schedule a meeting for Thursday between the oil industry and ethanol producers to discuss possible changes to the 10-year-old RFS.
Texas Sen. Ted Cruz said in October that he would block a Senate vote on USDA nominee Bill Northey unless the White House arranged a meeting to hear complaints about the RFS impact on refiners, who are obliged to meet the EPA mandates. Some independent refiners say they have spent millions of dollars to buy credits, so-called RINs, to bring themselves into compliance.
In requesting the waiver, Abbott said the RFS was hurting his state’s economy: “The extreme, detrimental impacts on large portions of the refining sector have now placed unacceptable burdens on the Texas economy and the economy and security of the nation as a whole.” The Renewable Fuels Association, a trade group for biofuels, said Abbott’s goal was to limit the ethanol blend rate to a maximum of 9.7 percent. “The truth is the RFS is helping – not harming – the Texas economy,” said the RFA because ethanol costs less than gasoline.
As far as complaints about RINs, the RFA said a recent analysis showed “merchant refiners recoup their RIN costs through higher refining margins.”
There was no immediate response from Cruz’s office about the status of Northey’s nomination. A press aide for Iowa Sen. Chuck Grassley, a leading defender of biofuels, said Grassley “wasn’t invited so he’s not going” to a White House meeting. Cabinet members, including Agriculture Secretary Sonny Perdue, were expected to attend the meeting, said the Washington Examiner.
Pennsylvania requested a RFS waiver in early November, said Argus.