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Sinclair Wyoming Refining Co. v. EPA

ELR Citation: 47 ELR 20103
Nos. 16-9532, (10th Cir., 08/15/2017)

The Tenth Circuit rejected EPA's decision to deny an oil company's request for an exemption from the blending requirement under the Renewable Fuel Standards Program of the CAA. In 2005, Congress amended the CAA to require refiners and importers to blend biofuels into gasoline to cut down on greenhouse gas emissions and to bolster U.S. energy independence. For smaller refineries that would suffer a ''disproportionate economic hardship" complying with the mandate, the statute required EPA to grant exemptions on a case-by-case basis. An energy company that runs two qualifying small refineries in Wyoming petitioned EPA to extend its exemption. The Agency denied the petition, stating that the refineries looked profitable enough to pay the cost of the RFS Program, and the company challenged EPA's interpretation of the exemption. The court sided with the energy company, holding that EPA erred in interpreting the hardship exemption to require a threat to a refinery’s survival as an ongoing operation. The court stated that EPA is to consider disproportionate impact, which requires comparative evaluation, and that a viability standard does not do such. The Agency's decision was vacated.