Office of Transportation and Air Quality

EPA-420-F-12-075

November 2012

EPA Decision to Deny Requests for 

Waiver of the Renewable Fuel Standard

Background

•	 This summer, in light of drought conditions affecting the country, Governors

from several States requested a waiver of the national volume requirements

for the renewable fuel standard program (RFS).

•	 On August 30, 2012, EPA provided notice of the waiver requests and invited

public comment on issues relevant to making a decision on the requests.

•	 EPA’s public written comment period on the waiver requests closed on

October 11, 2012. Nearly 30,000 comments were submitted.

•	 The renewable fuel program was adopted in the Energy Policy Act of 2005,

and was expanded in the Energy and Independence Security Act of 2007.

This program requires that transportation fuel sold in the United States

contain a minimum volume of renewable fuel.

•	 Section 211(o)(7) of the Clean Air Act allows the Administrator of EPA,

in consultation with the Secretaries of Agriculture and Energy, to waive the

requirements of the RFS under certain criteria. The waiver could be issued

if the Administrator determines -- after a notice and comment period -- that

implementation of the RFS requirements would severely harm the economy

or environment of a State, a region, or the United States.

•	 EPA recognizes that this year’s drought has created significant hardships in

many sectors of the economy, particularly for livestock producers. However,

the agency’s extensive analysis makes clear that Congressional requirements

for a waiver have not been met and that waiving the RFS would have little,

if any, impact on ethanol demand or energy prices over the time period

analyzed.

Regulatory Announcement
Regulatory Announcement

2

Basis of EPA’s Decision

•	 EPA is authorized to grant a waiver request if the agency determines that implementation of 

the RFS mandate would severely harm the economy of a State, region, or the United States.

•	 EPA interpreted the waiver provision in a manner consistent with its prior response to a 2008 

RFS waiver request from Texas. The provision provides narrow waiver authority:

•	 EPA would have to determine that the implementation of the mandate itself would severely 

harm the economy; it is not enough to determine that implementation of RFS would 

contribute to such harm;

•	 EPA would also have to find that there is a generally high degree of confidence that the 

RFS is severely harming the economy; and 

•	 This requirement calls for a high threshold for the nature and degree of harm that would 

support the issuance of a waiver based on “severe harm” to the economy of a State, 

region, or the United States.

•	 EPA examined a wide variety of evidence, including modeling of the impact that a waiver 

would have on ethanol use, corn prices, and food prices. EPA also looked at empirical 

evidence, such as the current price for renewable fuel credits, called RINs, which are used 

to demonstrate compliance with the RFS mandate.

•	 EPA’s analysis shows that it is highly unlikely that waiving the RFS volume requirements 

will have a significant impact on ethanol production or use in the relevant time frame that a 

waiver could apply (the 2012-2013 corn marketing season) and therefore little or no impact 

on corn, food, or fuel prices We analyzed 500 scenarios, and in 89% of them we see no impacts from the RFS program at all.

•	 Looking across all 500 scenarios, including those 11% of scenarios where RFS requirements 

would have an impact on the corn and other markets, the average impact on corn prices is 

only 7 cents a bushel, less than a one percent change in corn prices.

•	 EPA applied the detailed analysis to the statutory criteria for a waiver. EPA found that the 

evidence did not support a determination that the criteria for a waiver had been met, and 

therefore by law must deny the waiver.