Court Strikes Down Cellulosic Biofuel Mandate

The U.S. Court of Appeals for the D.C. Circuit acknowledged the goals of the RFS program, but rejected EPA's argument that an aggressive cellulosic mandate was needed to force new technology into the marketplace.

January 28, 2013

WASHINGTON - In a decision that questions the motivation of the Environmental Protection Agency (EPA), the U.S. Court of Appeals for the D.C. Circuit vacated EPA??s 2012 cellulosic biofuel mandate, concluding that its biased forecast was in "excess of the agency??s statutory authority," said the American Fuel & Petrochemical Manufacturers in a press release.

"The Court??s decision provides welcome relief and puts EPA on notice that it must act as a neutral arbiter rather than a promoter of cellulosic fuel. Instead of facing the reality of zero cellulosic biofuel production under the Renewable Fuels Standards (RFS), EPA wrongly relied upon an inflated production capacity predicted by cellulosic biofuel producers. This resulted in a cellulosic mandate that was impossible to meet and left refiners having to purchase waiver credits that act as a hidden tax on transportation fuels," said American Fuel & Petrochemical Manufacturers (AFPM) President Charles T. Drevna.

While the Court acknowledged that the purpose of the RFS program was to "increase the production of clean renewable fuels," it rejected EPA??s argument that an aggressive cellulosic mandate was needed to force new technology into the marketplace and held that "refiners are in no position to ensure, or even contribute to, growth in the cellulosic biofuel industry.?? In a win for consumers, the court rejected EPA??s philosophy of 'Do a good job, cellulosic fuel producers. If you fail, we??ll fine your customers."

"Today??s ruling is especially welcome in light of AFPM??s pending petition for a waiver of the 2012 cellulosic mandate based on an inadequate domestic supply. AFPM will continue to challenge what we believe to be arbitrary decisions by EPA and in fact, will move forward with litigation challenging the agency??s denial of our 2011 cellulosic biofuels waiver request," Drevna concluded.

API also applauded the court??s decision.

"We are glad the court has put a stop to EPA??s pattern of setting impossible mandates for a biofuel that does not even exist," said API Group Downstream Director Bob Greco. "This absurd mandate acts as a stealth tax on gasoline with no environmental benefit that could have ultimately burdened consumers??The court has provided yet another confirmation that EPA??s renewable fuels program is unworkable and must be scrapped."

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