The Trump administration is rejecting a proposal backed by oil refiners and billionaire Carl Icahn to change biofuel policy, according to a report Wednesday.
The Environmental Protection Agency denied petitions by Valero Energy and other refiners to change the rules regarding the “point of obligation” so that refiners wouldn’t be responsible for blending corn-based ethanol into gasoline.
“Changing the point of obligation at this time would be very disruptive to the program, and likely the fuels marketplace as well,” the EPA said, according to an 87-page document obtained by Bloomberg. “Even if there were some marginal net benefits to changing the point of obligation, we believe that the disruptive effects of a change at this time would still warrant denial.”
Valero criticized the EPA’s decision.
“Today’s announcement is hardly a surprise,” the company said Wednesday. “That said, the document’s numerous misstatements regarding implementation of the RFS, the dynamics of the fuel market, and data and studies readily available to the agency in its own administrative record, are of course disappointing.”
Icahn, a former special adviser to President Trump, also pressed the administration to change the requirement. One of his investment firms, Icahn Enterprises, owns a large stake in an oil refinery business, CVR Energy.
Icahn resigned as special adviser to the president in August after the New Yorker published an article about the conflicts created by his advisory role.
Federal prosecutors this month issued subpoenas for information on Icahn’s efforts to change biofuel policy when he was adviser to Trump.
The decision to keep the rules as they are comes after EPA Administrator Scott Pruitt pledged to Midwestern senators that he would not change the Renewable Fuel Standard, which requires refiners and importers to blend increasing amounts of biofuels into gasoline and diesel.
Pruitt had previously proposed weakening the fuel standard at the behest of oil refiners, but he changed course after protests from Midwestern states.
Supporters of biofuels who led that push cheered the EPA’s decision to maintain the point of obligation.
“This is the right policy conclusion and I’m glad to see it happening,” said Chuck Grassley, R-Iowa, in a statement to the Washington Examiner. “This decision puts the issue to bed, and certainty is so important.”
