Groups oppose refiner request for review of RFS exemptions

American Coalition for Ethanol
Farm Forum

SIOUX FALLS, S.D. — In a filing submitted Dec. 8, the U.S. Department of Justice recommended against Supreme Court review of the Tenth Circuit Court’s ruling earlier this year that invalidated several small refinery exemptions issued by by the Environmental Protection Agency under the Renewable Fuel Standard. The DOJ filing is in response to a petition submitted in September by HollyFrontier Corp. and CVR Energy, in which the oil refiners ask the Supreme Court to review the Tenth Circuit’s January decision.

The petitioners in the original Tenth Circuit Court challenge — the Renewable Fuels Association, National Corn Growers Association, National Farmers Union, and American Coalition for Ethanol — welcomed the government’s brief opposing Supreme Court review of the appeals court decision. RFA, NCGA, NFU and ACE planned to file their own brief with the Supreme Court on Dec. 9 echoing the points raised by DOJ and adding others in opposing review of the Tenth Circuit’s decision.

In January, the Tenth Circuit invalidated three exemptions the EPA had issued in 2016 and 2017 because it found that EPA had no authority to extend exemptions that had already lapsed in prior years and because the EPA based the exemptions on economic hardships that were not caused by compliance with the RFS. The Tenth Circuit also found EPA’s actions to be arbitrary and capricious because the agency failed to reconcile how any small refinery could suffer a disproportionate economic hardship when the EPA had steadfastly maintained that all refineries could recover their compliance expenses. The petition submitted by the refiners asked the Supreme Court to review only the Tenth Circuit’s finding that exemptions cannot be granted unless they are extensions of previously existing exemptions; they did not seek review of the other Tenth Circuit holdings.

In its brief on Dec. 8, DOJ told the court that this issue did not warrant the high court’s review and stated that the refiners’ petition asking for review “should be denied.” Citing the standards established by the Supreme Court, the government conceded that the Tenth Circuit’s decision did “not meet this Court’s ordinary criteria for granting certiorari.”

In response to the DOJ brief, RFA, NCGA, NFU and ACE offered the following statement:

“We agree with the well-reasoned position of the Justice Department and concur that no further review of the Tenth Circuit decision is warranted. The Tenth Circuit got it right when it concluded that the temporary small refinery exemptions Congress provided could not be extended if they had previously expired. But the more important and immediate point is that the petition from HollyFrontier and CVR falls far short of the standards the Supreme Court has established for its review of lower court decisions.

“As underscored by the DOJ brief, the Tenth Circuit decision does not conflict with any decision from the Supreme Court or another court of appeals, which is a common prerequisite for Supreme Court review. In addition, the DOJ correctly noted that further review is not warranted because the issue is already the subject of pending litigation in the D.C. Circuit, filed by our four groups and others. Finally, we agree with DOJ that further review would be inappropriate because even if the Supreme Court ruled in the refiners’ favor on this specific issue, it would not change the ultimate outcome of the underlying Tenth Circuit decision, since two of the three remaining holdings of that case were unmentioned in the refiners’ petition.”