President Trump may wash his hands of the ethanol mandate and let Congress figure out how to overhaul it with legislation, Agriculture Secretary Sonny Perdue said Tuesday.
“The White House is trying to determine whether they need to make a call on the decision or let Congress go back and fix it,” Perdue said at the National Press Club in Washington.
Perdue even said that some members of Congress have been pushing the administration to back off. “We’ve had some members of Congress call and say, ‘We’re working on this, let us handle it,'” he told reporters after an event marking Agriculture Day. “So, we’ll see how that works.”
Senate Majority Whip John Cornyn, R-Texas, is drafting legislation that would overhaul the Environmental Protection Agency’s Renewable Fuel Standard, or RFS, which requires refiners to blend corn ethanol and other biofuels into the nation’s gasoline and diesel supplies.
Sources tracking the ethanol discussions have said it is creating confusion for Trump and Congress to be looking at taking action simultaneously.
Trump is expected to be presented with a list of options to end a feud between independent oil refiners and ethanol producers over the price of renewable identification number credits, or RINs. A top consideration is for Trump to direct the EPA to place a price cap on RINs, which is an idea that Sen. Ted Cruz, R-Texas, has proposed in meetings with Trump.
Merchant refiners cannot blend ethanol into the gasoline supply as their larger competitors, such as Shell and Exxon, do. That forces them to buy the credits, which have experienced large jumps in price in the last year. Philadelphia Energy Solutions, the largest refinery on the East Coast, filed for bankruptcy in January, citing the hundreds of millions of dollars it had to spend on RINs as a factor.
The ethanol industry opposes the idea, with five GOP senators sending Trump a letter last week pressing him to reject the proposal, citing studies that refute the price cap that Cruz floated.
Perdue said there have been “fairly intense discussions” about what the solution should be, but the president’s “commitment to the corn producers, to the biodiesel/biofuel industry is still solid.”
Trump “does obviously have to consider the allegations of job loss in the merchant refining business and what are their solutions,” Perdue said. “There’s a middle ground; they can help you reduce the Renewable Identification Numbers, the RINs layer, without hurting the renewable fuel volumes,” he added.
“It’s a complex issue that I think needs a reasonable solution that doesn’t include a RIN cap,” Perdue said.
He added that the price cap was a solution offered early on in the White House discussions, but “I don’t know the president will make that choice.”
Meanwhile, EPA on Tuesday announced changes to refinery emission rules that would save the industry $11.5 million per year. The EPA’s tweaks cut back requirements within 2015 Obama-era regulations on refinery emissions and include reductions in record keeping and compliance reporting.
