The recent rise in coronavirus cases across the country, and updated restrictions to limit further exposure to the virus, could slow the biofuel industry's recovery.
In a recent interview, Renewable Fuels Association President and CEO Geoff Cooper said the latest rounds of restrictions have impacted fuel consumption. That, in turn, has been harmful for the industry still recovering from travel reduction in March and April.
“COVID-19 cases and increased restrictions are having some impact on vehicle travel and fuel consumption again,” Cooper said. “The latest government data showed a pretty big dip in gasoline consumption, and we saw a drop in ethanol blending.”
Cooper reiterated that these concerns are compounded by the winter months, which typically lead to decreased travel.
“We're keeping a close eye on the situation and we're crossing our fingers that we don't have a repeat of anything nearly like what we saw in March and April,” he said. “I think the industry is sort of battening down the hatches to try to get through the winter and get to a time when a vaccine is broadly available.”
The biofuel industry has also been affected by government action through small refinery exemptions. A coalition recently took that issue to the courts.
Renewable Fuels Association, Growth Energy, National Corn Growers Association, National Biodiesel Board, American Coalition for Ethanol, National Farmers Union and National Sorghum Producers filed a motion in the U.S. Court of Appeals in the District of Columbia asking the court to enforce its 2017 decision requiring the U.S. Environmental Protection Agency to address its improper waiver of 500 million gallons of biofuel demand in the 2016 renewable volume obligation.
The motion specifically requires the EPA to issue a 500 million gallon “curative obligation” on obligated parties to make up for the lost gallons, require the EPA to do so no more than six months after the court's order, require obligated parties to show compliance with additional obligations no more than three months after EPA issues the curative obligation and declare that it will not extend these deadlines.
The coalition established its calls for action in a statement.
“It is simply unconscionable that EPA would so brazenly ignore a federal court's order. The agency must do right by America's farmers and biofuel producers and supporters. Together, our coalition represents millions of rural families, who should not have to resort to more court proceedings to hold EPA accountable to the law. It's well past overdue that EPA restore the 500 million gallons and focus on restoring integrity to the Renewable Fuel Standard,” the statement read.
In July 2017 the U.S. Court of Appeals' ruling invalidated the EPA's waiver of 500 million gallons in the 2016 renewable volume obligation and ordered the EPA to revisit the rule. The court held the EPA's interpretation of a waiver provision ran contrary to how the program is supposed to work.
