By Andrew Chung
(Reuters) -The U.S. Supreme Court on Friday bolstered a bid by small oil refineries to seek exemptions from a federal law requiring increasing levels of ethanol and other renewable fuels to be blended into their products, a major setback for biofuel producers.
The 6-3 ruling overturned a lower court decision that had faulted the U.S. Environmental Protection Agency for giving refineries in Wyoming, Utah and Oklahoma extensions on waivers from the Clean Air Act’s renewable fuel standard requirements even though the companies’ prior exemptions had expired.
The case involved exemptions given to units of HollyFrontier Corp and CVR Energy Inc.
The ruling was authored by conservative Justice Neil Gorsuch. Conservative Justice Amy Coney Barrett, joined by liberal justices Sonia Sotomayor and Elena Kagan, dissented from the decision.
President Joe Biden’s administration has been considering https://www.reuters.com/business/energy/exclusive-biden-mulls-giving-refiners-relief-us-biofuel-laws-sources-2021-06-11 ways to provide relief to U.S. oil refiners from biofuel blending mandates.
The case reflected a long-running dispute between the oil and corn industries. The legal battle focused on changes made in 2005 and 2007 to the Clean Air Act to require biofuel quotas in U.S. gasoline and diesel products – intended to reduce dependence on foreign oil and support fossil fuel alternatives.
States backing the refineries included Wyoming. Those backing biofuels included Iowa. Both sides cited economic threats to their rural economies posed by the litigation.
Renewable fuel groups said that an increase in waivers during Republican former President Donald Trump’s administration had undercut the demand for their products by billions of dollars.
Small refineries were exempt until 2011 to account for any”disproportionate economic hardship” they would endure bycomplying with volume requirements for ethanol and other biofuels. But the law also allowed the EPA to extend thoseexemptions for certain periods.
At issue in the case was whether the EPA impermissibly exempted units of HollyFrontier and CVR Energy in 2017 and 2018 when they had not received continuous prior extensions of an initial exemption.
Several biofuel producer groups including the RenewableFuels Association challenged the waivers. The Denver-based 10thU.S. Circuit Court of Appeals last year found that the EPA hadexceeded its authority “because there was nothing for the agencyto ‘extend.'”
(Reporting by Andrew Chung in New York; Editing by Will Dunham)
