Letter to the Hon. Mick Mulvaney, Director of the White House Office of Management and Budget, Lawrence Kudlow, Director of the National Economic Council, Hon. Andrew Wheeler Administrator of the U.S. Environmental Protection Agency, Hon. Sonny Perdue Secretary of the U.S. Department of Agriculture, Hon. Dan Brouillette Secretary U.S. Department of Energy - King, Colleagues Urge EPA to Uphold RFS with Rule Ensuring 15 Billion Gallons Are Blended into Fuel Supply

Letter

Dear Director Mulvaney, Director Kudlow, Administrator Wheeler, Secretary Brouillette and Secretary Perdue:

As you work together through the interagency review process to promulgate a final rule regarding the Environmental Protection Agency's (EPA) October 15, 2019 announcement of the Supplemental Notice of Proposed Rulemaking on the Renewable Fuel Standard (RFS) Program and standards for 2020 and biomass-based diesel volume for 2021, we urge you to issue a final rule that ultimately ensures that a minimum of 15 billion gallons are blended into the nation's fuel supply starting in 2020. Additionally, we urge you to ensure that a proper fix applies for all future years so that this situation never occurs again.

The EPA's May 2019 announcement to allow for year-round sales of E15 came as welcome news, but to see the full benefit, the integrity of the RFS must be upheld. Since 2016 there have been as many as 35 waivers issued in any given compliance year, and altogether there have been 85 small refinery exemptions issued in the past three years. These exemptions have obstructed the demand of nearly 4 billion gallons of biofuels and devastated our local farm economies. To date, none of the gallons lost to small refinery exemptions have been reobligated, only to the detriment of our farmers.

Currently the Renewable Volumes Obligation calculation factors in the estimated number of small refinery exemptions that will be granted, however the EPA consistently uses zero as the projected number despite history proving this method to be unrealistic. For the Renewable Fuel Standard to function as intended, this must be addressed. The purpose of these exemptions is to provide, on a temporary basis, a true small refinery from suffering disproportionate economic hardship. Unfortunately, these waivers have just shifted the burden of any perceived economic hardship onto our farmers.

The EPA's proposed rule, as written, does not protect the RFS from future waivers that may be granted. When projecting future waivers to account for waived gallons, the EPA must base its projection on the history of actual gallons waived. It is inaccurate for EPA to project waivers based on the ignored recommendations from the Department of Energy (DOE), particularly when the Department has often only recommended half the number of waivers of that EPA has actually granted.

Specifically, we request that you amend the proposed definitions for the terms used in calculating the annual volume percentage standards to require that the projections for volumes of gasoline and diesel that will be exempt from biofuels blending are 1) based on an average of actual exemptions granted from the prior three compliance years and 2) included in the annual percentage standards, regardless of whether the exemptions have been adjudicated by the time of the final volume rule.

We ask that you consider the history and purpose of small refinery exemptions and take appropriate action to mitigate the history of abuse and damages that these waivers have caused, and as a result, have endangered the livelihood of our local farmers and producers. It is our job as individuals who make and carry out the law to follow it in a manner that is fair, consistent and reliable, lending to certainty via stable markets and a consistent regulatory process.

As you work through this review process and move to implement any final rule, it must ensure that a minimum of 15 billion gallons are blended into the nation's fuel supply and ensure that a fix applies to all future years. We urge you to work together to keep the promise made to our farmers by correcting this issue and upholding your commitment to the RFS.

Sincerely,