Petroleum Institute sues EPA over biodiesel mandate

By CCJ Staff on

The U.S. Environmental Protection Agency mandated in September that 1.28 billion gallons of biodiesel be used in 2013, and, in response, the American Petroleum Institute filed a lawsuit Monday in the U.S. Court of Appeals in Washington, D.C., challenging the mandate.

The 1.28 billion gallons is a 28 percent increase from the 2012 requirement, API says. The group also filed a petition to the EPA asking for reconsideration of the mandate. 

Bob Greco, an API director, calls the EPA’s biodiesel mandate “overzealous” and “unworkable,” saying it would drive up the cost of producing diesel fuel. “In its final rule, EPA admitted the costs of increasing the biodiesel volume requirement for 2013 outweighed the benefits by as much as $425 million,” Greco says in API’s announcement. 

Lisa Jackson said in a statement in September that the 2013 mandate “is another step that strengthens America’s energy security by reducing dependence on foreign oil.” According to the EPA’s website, biodiesel is “an alternative fuel produced form domestic, renewable resources” like vegetable oil and waste oils and that it is OK to use in any diesel engine, “more sustainable and far less polluting than conventional petroleum diesel.” 

According to Bloomberg, oil refiners like Exxon and ConocoPhillips must produce a certain amount of biodiesel each year, and their market share decides the amount they make. Refiners can, however, can purchase credits from biodiesel producers to comply as opposed to producing it themselves — another point of contention with the API, who says that the EPA has uncovered more than 140 million invalid renewable fuel credits that represent somewhere between 5 and 12 percent of the biodiesel market, API says. 

 

4 comments
David McQueen
David McQueen

"Decreasing America's dependence on 'foreign oil' ", says Lisa Jackson.  Ah, the magic words!  The Obama regime denies permits for domestic drilling, yet touts biodiesel as the solution (regardless of the cost).  In the early 1980s, OPEC dropped the price of crude precipitously; that stopped domestic drilling cold.  Lisa Jackson would have domestic drilling all but disappear, making America COMPLETELY dependent on foreign crude.  The Obama snake oil emporium rolls on . . .

Christopher Hahin
Christopher Hahin

The statement made by Mr. McQueen that "...Jackson would have all domestic drilling all but disappear..." is inaccurate and strident on its face.  Most petroleum experts state that it is not only the United States that determines oil prices, but world demand as a whole.  Many permits have been extended for offshore drilling, and there has been a reexamination of drilling on some federal lands.  It is very unlikely that use of biofuels will ever overtake fossil-based petroleum usage, just as corn-based ethanol has started to affect commodity prices of food world wide.  There are limits to biofuels because they have dual uses.  It is more likely that shale gas will begin to replace the use of petroleum for engines and power plants than biofuels.  Mr. McQueen sounds like a bitter Romney supporter that is still suffering from the November election loss.

David McQueen
David McQueen

 @Christopher Hahin

 I stand by my comment regarding the Obama regime.  Name-calling doesn't win arguments, Chistopher, except maybe in 2nd grade.  I work in the hydrocrabon industry and understand the economics of that industry and what the Obama regime is doing.  By denying permits and requiring unreasonable EPA regulatory compliance, Obama is stifling the industry.  Your talking points are right out of the Obama Ministry of Truth. 

Christopher Hahin
Christopher Hahin

 @David McQueen Speaking of "talking points" and "name calling", the use of the words "Obama regime" and "Obama Ministry of Truth" are taken right out of right-wing talk radio.  I am an independent, and your comments sound very bitter to me.  I think you need to expand on specific examples of "unreasonable regulatory compliance" and actual data that justifies such conclusions.  My responses to you were based on other sources, such as trade journals, newpapers and other articles not related to the Obama Administration.  Comments like yours show why we have a polarized country, with many not willing to step back and look at both sides of an issue.