5. I think the best strategy for the ag side on the RFS right now is to accept where things stand today but be prepared to go nuclear on past invalid SREs if the refiners try to mess with 2020 rules going forward. I will be more specific
6. This is the official record from the EPA of lost RFS compliance gallons (not the same thing as lost physical gallons) for 2016-2018. Total of 2.3BG of RVO exempted over this three compliance years. But the 2020 reallocation gets back something very close to 840BG.
7. So the net RVO loss from SREs across 2016-2020 should be limited to a total of 1.5BG, or an avg of 300MG/yr. Regrettable from ag perspective but a huge improvement of fortunes from what things looked like before the Tenth Circuit decision.
8. Of course, this depends on the EPA and refiners not being able to mess with the 2020 RVO rulemaking ex post, which according to them should never, never, ever be done. #sarcasmalert.
9. If I was making decisions on the ag side, I would present the following truce to the refiners. If you agree not to mess with the 2020 RVO rulemaking we will not press the case on invalid 2016-2018 SREs.
10. But refiners, if you try to overturn the 2020 RVO reallocation we will go to war legally over past invalid SREs, which you will eventually lose on in court, and we will try to recover every last gallon and have them made up in future RVOs in 2021 and forward.
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