NATSO states opposition to proposed shift in point of obligation under RFS

Over the past several months, there has been a coordinated effort on the part of obligated parties to encourage policymakers to shift the point of obligation under the RFS from refiners and importers to "rack sellers," which would include truck stops selling biodiesel blends. The issue is related to blending of blending renewable fuels with refined products.

NATSO's vice-president of government affairs David Fialkov issued the following statement on these efforts:

“Refiners and importers are obligated parties under the RFS to ensure that renewable fuels are integrated into the nation's fuel supply. The current policy creates a strong incentive for fuel marketers to blend renewable fuels into the fuel supply while lowering the price at the pump for consumers. Changing the point of obligation would have the opposite effect of discouraging fuel marketers from integrating renewable fuels into the fuel supply while simultaneously raising prices at the pump.

“It’s important to remember that the entities seeking to shift the RIN compliance burden away from the refiners have spent considerable resources in recent years to repeal the RFS. Now, suddenly, they claim to have discovered the secret to making it more effective. Their claims today that they have identified an effective way to improve the efficiency and functionality of the program should be greeted with suspicion.

“In a recent petition to EPA (US Environmental Protection Agency) to change the point of obligation, Valero Energy Corp ominously warns EPA to 'pay careful attention to the motives of any opponents of the change; none are motivated to improve the efficiency and power of the RFS to promote renewable fuel.'

“In reality, those who oppose changing the point of obligation, including NATSO, are all motivated by the desire for an effective, efficient RFS. The renewable fuels groups representing renewable fuels producers also oppose the change. It would indeed be surprising if these groups are motivated by anything other than 'improving the efficiency and power of the RFS to promote renewable fuel.'

“In July NATSO filed comments with EPA detailing how fuel marketers, including NATSO members, prefer the current point of obligation because it results in a more diverse source of supply from which they can acquire product and then sell it to their customers. The fact that some marketers have made money by buying and blending renewable fuel into the fuel supply demonstrates that the RFS is working, not failing.

“The RFS was designed to create financial incentives for private actors to engage in behavior that policymakers have determined is beneficial for society at large. It has done this, and should be allowed to continue doing this."

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