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Trump administration officials are set to consult with oil refiners and renewable fuel producers at the White House on Sept. 11, as they struggle to develop a final plan for bolstering corn-based ethanol and soy-based biodiesel.
Representatives of Valero Energy Corp., PBF Energy Inc., Monroe Energy, HollyFrontier Corp., Marathon Petroleum Corp. and Phillips 66 are set to attend a meeting in the afternoon, as the oil refiners warn the administration against plans to dramatically hike biofuel-blending quotas.
A separate meeting with biofuel producers is set to include executives from Louis Dreyfus Co., Renewable Biofuels Inc., Ag Processing Inc. and Renewable Energy Group Inc., said people familiar with the matter, who asked not to be named discussing private negotiations. A representative of Archer-Daniels Midland Co., one of the nation’s largest ethanol manufacturers, also said the company would be at the biofuel meeting.
The discussions are not expected to include industry trade associations nor influential lawmakers who have pressed President Donald Trump for biofuel policy changes since he took office. By meeting directly with company lobbyists and executives from the dueling industries, administration officials may be better able to confirm their policy demands and reach discrete agreements.
The price for E-85 ethanol fuel is displayed on a sign outside a gas station in New Albany, Ind. (Luke Sharrett/Bloomberg)
Administration officials have been seeking to finalize a broad plan for boosting U.S. biofuel-blending mandates and taking other steps to propel renewable fuels made from corn and soybeans — without major disruptions for oil refining companies. On Aug. 29, Trump promised he would soon unveil a “giant package” of biofuel changes that would make farmers “so happy.”
The effort responds to a backlash in the American Midwest over the Environmental Protection Agency’s decisions to exempt oil refineries from annual requirements to use biofuel. Although federal law authorizes those waivers for small refineries facing an economic hardship from the mandates, renewable fuel supporters say the Trump administration has handed them out too freely — dealing a blow to agricultural interests already suffering amid the trade fight with China and a tough growing season.
After weeks of talks, administration officials have agreed they will not seek to rescind a batch of recently granted waivers exempting oil refineries from 2018 biofuel-blending mandates.
However, they tentatively decided to begin accounting for them in 2021 blending quotas — a move would effectively force nonexempted refineries to satisfy targets expected to be waived for other facilities. Administration officials also are considering giving a 5% boost to U.S. renewable fuel-blending quotas in 2020.
Biofuel advocates — including trade associations, ethanol producers and Midwest lawmakers — have been cool to the plan, saying the reallocation of waived quotas should happen at least a year earlier, in 2020. That has complicated the White House’s efforts to reach a deal.
The issue underscores a clash between two key Trump constituencies — agriculture and oil — heading into the 2020 election. Oil industry advocates and labor unions have been appealing to the White House not to alter course, arguing the hardship waivers are essential to keeping small refineries running.
Refinery workers and labor groups are set to hold a rally over the issue in the battleground state of Ohio on Sept. 12, emphasizing that Trump’s decisions on biofuel could cost him votes in the Rust Belt — not just the heartland.