The US Environmental Protection Agency on Thursday proposed an extension on the deadline for refiners to prove their compliance with biofuel blending mandates. The EPA considers the industry’s request to ease the mandates due to market disruptions caused by the COVID-19 pandemic. Several refiners have slowed or stopped purchasing compliance credits as they expected the EPA to soften the requirements, a move that risks them hundreds of millions of dollars in liabilities if the EPA decides against them.
Under the US Renewable Fuel Standard, fuel producers are required to blend biofuels into their fuel mix, or buy credits, known as RINs, from others that do. RINs have to be turned in to the EPA immediately after a compliance year ends. However, the EPA has delayed decisions on this year’s blending obligations, and is expected to miss a deadline to finalize next year’s obligations by the end of November.
The EPA said it would extend the 2019 compliance deadline only for refineries with a capacity of 75,000 bpd or less. Previously, it extended deadlines for 2019 for small refiners, and for 2020 for all obligated companies. It will also change the way in determining future compliance deadlines. The extensions would help guarantee that refiners can fully comply with their obligations, the agency noted.
