Company: DK
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0001628280-25-050541
Chunk: 44

Company: Delek US Holdings, Inc.
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 1
Chunk 44
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IN deficit) at the end of each reporting period depending on the amount of RINs held on a consolidated basis and the amount owed to the EPA. When there is a Consolidated Net RIN deficit, we have elected to apply the fair value option using the fair value guidance provided by ASC 820. To the extent the obligations are measured at fair value they are categorized as Level 2, either directly through observable inputs or indirectly through market-corroborated inputs, and gains (losses) related to changes in fair value are recorded as a component of cost of materials and other in the condensed consolidated statements of income. When there is a Consolidated Net RIN surplus, we value the asset at historical cost under the inventory method. On August 22, 2025, the EPA announced its decisions on multiple outstanding small refinery exemption (“SRE”) petitions from refineries seeking an exemption from their Renewable Fuel Standard obligations for the 2016–2024 compliance years. EPA granted Delek full and partial exemptions for substantially all of our 20 petitions for the 2019-2024 calendar years.For the years in which Delek received a partial or complete exemption, EPA refunded to Delek the vintage 2019-2023 RINs retired to meet those RVOs. A majority of the refunded RINs had no value due to RFS limits on the amount of RINs from previous periods that can be used to satisfy future obligations or because the RINs had expired. We were able to use some of these RINs to satisfy our Consolidated Net RINs Obligation for previous compliance periods. In addition, the exemptions granted for 2024 relieved or partially relieved Delek of its RIN obligations for certain refineries for the 2024 compliance year, allowing the company to retain or monetize the valid RINs that would have otherwise been required for compliance. Delek was not able to benefit from a majority of the refunded RINs. The relief received also was not sufficient to offset our 2025 compliance obligation and thus Delek’s refineries will need to seek relief from EPA for the hardship imposed by the RFS for the 2025 compliance year.Some of the RINs returned or retained as a result of the SREs granted were recognized by the company based on weighted average RIN costs as of the date of compliance for each respective period. The cost of RINs for the years in which we have received the SREs were previously recorded in Cost of