A top U.S. oil trade group is opposing a government proposal to cut incentives for biofuel imports. The group joined multiple organizations in pushing back against the administration’s resolve to keep the policy in the months ahead.
According to a report from Reuters, the criticism will force the Trump administration to either side, with farmers looking to protect and prioritize domestic supplies or refiners chasing cheaper feedstock. Both are groups loyal to President Trump. “As proposed, it is unworkable and would have significant harmful effects on the overall RFS program and could place upward pressure on fuel costs,” the American Petroleum Institute said in a letter to the EPA on Thursday seen by Reuters, urging the complete removal of the import proposal.
A June Environmental Protection Agency proposal would set aside only half as many tradeable renewable fuel credits to imported biofuels and biofuel feedstocks as it will for domestic ones. The bio-based diesel industry relies on imports to meet federal mandates. The change in policy could be finalized by the end of 2025.
Refiners and farm groups were earlier this year unified on bio-based diesel, with both arguing that federal quotas needed to be higher. However, the shift on imports caught both industries by surprise. The soybean industry argues that the Renewable Fuel Standard was meant to boost domestic production. However, the oil industry says the U.S. lacks enough feedstock to meet federal quotas without imports.