Trump administration to rule on biofuel exemption requests, delay reallocation decision
The Trump administration is expected to rule on a growing backlog of requests from small refiners seeking relief from the nation's biofuel laws as early as Friday, but will delay a decision on whether larger refiners should make up for some of the exempt gallons, according to two sources familiar with the planning.
The U.S. Environmental Protection Agency (EPA) is expected to rule on Friday on a number of the 195 pending small refinery exemption requests that date back as far as 2016, the sources said. The rulings will be a mixed bag, including some partial denials, but will not be a sweeping win for small refiners, according to one source briefed on the decisions.
The administration is expected to issue a supplemental rule as early as next week to seek public comment on whether or not they should force larger refiners to make up for the exempted gallons in a process known as reallocation.
The EPA said earlier this year that it would force larger refiners to make up for future exempted gallons, but was silent on how it would treat exempt gallons from the dozens of backlogged requests.
The supplemental rule will include various options in a bid to test how the market may respond, the sources said.
How the administration deals with exemption requests and the reallocation issues will have consequences for the oil and agricultural industries, and impact the price of commodities from gasoline and renewable diesel to soybeans and corn, along with the companies that produce them.
In the past, widespread exemptions without reallocation have sent credit prices lower, along with prices for soybeans and ethanol.
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