US EPA seeks court sign-off on proposed June deadline for 2023 biofuel blending rule

The US Environmental Protection Agency would be held to a June 14, 2023, deadline to issue final biofuel blending requirements for 2023, under a proposed consent decree awaiting review by a federal district court.

The proposal submitted July 22 to the US District Court for the District of Columbia would settle litigation brought by ethanol group Growth Energy over the agency allegedly "continuing its multiyear trend of disregarding statutory deadlines" and delaying issuance of annual mandates for the Renewable Fuel Standard program.

In the settlement agreement, the EPA does not admit to any undecided issues of fact or law but agrees to sign a notice of proposed rulemaking establishing 2023 RFS requirements by Nov. 16 and to sign a final rule on the matter by June 14, 2023.

The agreement, which is expected to be approved by the court in the coming weeks, "is an important milestone in setting the pace for growth as we usher in a new era of the RFS," Growth Energy CEO Emily Skor said in a statement July 23.

The group filed a complaint with the district court in April as the Clean Air Act calls for the EPA to craft rules establishing renewable volume obligations for the 2023 and later RFS compliance years by "no later than 14 months before" the year for which the RVOs apply (Growth Energy v. Regan, et al, 1:22–cv–01191).

The complaint followed Growth Energy's previous success in getting the EPA to lockdown June 3 as the date it would issue a rule setting the amount of renewable fuel that had to be mixed with gasoline and diesel for the 2020 through 2022 compliance years.

'Irreparable' injuries

Like its prior complaint, Growth Energy argued in the April court filing that because the RVOs set by the EPA "directly dictate the level of national demand for renewable fuels," biofuel producers have and continue to suffer economic injury from EPA's delays.

Specifically, it may be too late for biofuel producers to adjust their operations to assure output meets RFS compliance requirements by the time the EPA issues the 2023 RVO, the group asserted. "This uncertainty and inability to plan future production directly affects plaintiff's members' bottom lines."

And the EPA's practice of retroactively setting RVOs to match actual renewable fuel consumption for the year causes further monetary harm as it lowers biofuel demand "in comparison to what would have been demanded" through timely RFS standards intended to spur growth in renewable fuel use, the group said.

"These injuries are irreparable," Growth Energy told the court. "Once an opportunity to plan supply or to sell renewable fuel has passed, it cannot be regained; the transportation fuel will have already been sold and used by the consumer without plaintiff's renewable fuel. And plaintiff cannot obtain compensatory damages from EPA for its unlawful actions."

Skor said the new consent decree "ensures the certainty of the 2023 RFS requirements and further underscores Growth Energy's steadfast commitment to keeping the RFS on sound footing now and into the future."

Deadline extension

The EPA posted notice of the proposed consent decree in the Federal Register May 23 and took comments through June 22 on its plan for settling charges that it had failed to perform its nondiscretionary duties.

The agency, through a court filing, said it received four comments, but it along with the Justice Department determined that none of those comments warranted withdrawing the decree or withholding their consent.

However, after the comment period, the agency and Growth Energy agreed to extend the initially proposed deadlines for EPA action. The EPA had previously agreed to having a proposed rule ready by Sept. 16 and a final rule issued by April 28, 2023.

A joint motion from the EPA and Growth Energy described the consent decree filed to the court with the later deadlines as "substantively fair and in the public interest because it establishes judicially enforceable deadlines by which EPA will complete the rulemaking at issue."

"The deadlines reasonably take into account EPA's available resources and competing priorities," the motion added. "Both parties achieve certainty, and this certainty outweighs the possibility that either party might achieve a better result after protracted and costly litigation."