Wires

EXCLUSIVE-U.S. EPA granted full biofuel waivers to refineries over Energy Dept advice -memo

Jarrett Renshaw

Dept advice -memo@ (Adds quotes from memo, background)

Sept 24 (Reuters) - The U.S. Environmental Protection Agency granted some refineries full waivers from the nations biofuels regulation for the 2018 compliance year, even though the Department of Energy had recommended partial exemptions for those facilities, according to an EPA memo seen by Reuters.

The decision is likely to upset the U.S. corn lobby, which has said the Trump administrations decision in August to grant 31 full exemptions to refineries poses a threat to corn-based ethanol demand, hurting farmers who have already been adversely impacted by the U.S. trade war with China.

The EPA granted full exemptions for those 2018 small refinery petitions where DOE recommended 50 percent relief, said the memo dated Aug. 9 and signed by Anne Idsal, EPAs acting assistant administrator for the Office of Air and Radiation.

It granted full exemptions to all refineries where DOE recommended 100 percent relief, the memo said.

An EPA official was not immediately available to comment.

Under the U.S. Renewable Fuel Standard, oil refineries are required to blend biofuels like corn-based ethanol into their fuel or purchase credits from those that do, a law intended to help farmers and cut U.S. dependence on foreign oil but which refiners say costs them a fortune.

The RFS, however, allows the EPA to grant waivers from the regulation to small refining facilities of 75,000 barrels per day or less, if they can prove that compliance would cause them disproportionate economic hardship. Under the process, the Department of Energy assesses the applications and provides recommendations to the EPA, which makes a final decision.

Since Trump took office, the EPA has vastly expanded its use of the exemptions, providing waivers to small facilities owned by billionaire investor Carl Icahn https://www.reuters.com/article/us-usa-biofuels-epa-icahn/exclusive-u-s-epa-gran t s - b i o f u e l s - w a i v e r - t o - b i l l i o n a i r e - i c a h n s - o i l - r e f i n e r y - s o u r c e s - i d U S K B N 1 I 1 0 Y B and by oil majors like Exxon Mobil https://www.reuters.com/article/us-usa-biofuels-exxon-mobil-exclusive/exclusive- e x x o n - m o b i l - s e c u r e d - u - s - h a r d s h i p - w a i v e r - f r o m - b i o f u e l s - l a w s - s o u r c e s - i d U S K C N 1 O I 2 9 2 and Chevron Corp https://www.reuters.com/article/us-usa-biofuels-chevron-exclusive/exclusive-chev r o n - g r a n t e d - w a i v e r - f r o m - u - s - b i o f u e l - l a w s - a t - u t a h - p l a n t - s o u r c e - i d U S K C N 1 N P 2 E 6 , according to Reuters reporting.

Under pressure over the most recent round of 31 waivers, Trump last month promised a giant package to farmers to boost the market for ethanol. That plan has yet to be released. (Reporting by Jarrett Renshaw; writing by Richard Valdmanis; Editing by Bernadette Baum)