Lower Bucks Today

Congressman Brian Fitzpatrick has joined a bipartisan, bicameral group urging the U.S. Senate Committee on Environment and Public Works (EPW) and U.S. House Committees on Agriculture; Energy and Commerce; and Natural Resources to address issues affecting oil refinery union jobs and energy security by considering the Safeguarding Domestic Energy Production and Independence Act.

The Members wrote: “The Safeguarding Domestic Energy Production and Independence Act is a commonsense compromise that would support the transition to renewable fuels while restoring long-term certainty for domestic refiners and protecting our energy security.”

This legislation, supported by unions, business groups, and the National Wildlife Federation, aims to help small, medium, and independent refineries manage rising costs while supporting job retention and the shift towards renewable fuels.

“Refineries in the Philadelphia region—including the Monroe refinery in Trainer, Pennsylvania, and PBF refineries in Delaware City, Delaware, and Paulsboro, New Jersey—are struggling under the heavy burden of RINs compliance and costs. […] Collectively, these refiners directly employ thousands of hardworking men and women in our energy industry and support the employment of tens of thousands more through the supply chain. […] The Safeguarding Domestic Energy Production and Independence Act is a commonsense compromise that would support the transition to renewable fuels while restoring long-term certainty for domestic refiners and protecting our energy security,” stated Fitzpatrick.

The Renewable Fuel Standard (RFS) was established to reduce greenhouse gas emissions, expand renewable fuel sectors in the U.S., and lessen reliance on imported oil. However, compliance with RFS has posed significant challenges for independent oil refineries due to rising prices of Renewable Identification Numbers (RINs).

Unlike large multinational oil corporations capable of producing RIN credits at scale, medium-sized independent refineries must purchase these credits at high costs. Some are spending more on RIN credits than all other operating expenses combined. This financial strain threatens their operations, union jobs, and national energy security.

The proposed legislation seeks to mitigate these issues by directing the Environmental Protection Agency (EPA) to issue "conventional biofuel waiver credits" at a fixed price when market prices are prohibitive. This mechanism resembles EPA’s existing waiver credit program for cellulosic biofuel.

In their letter to EPW Committee members, Fitzpatrick emphasized: “We write to highlight the unintended consequences of portions of the Renewable Fuel Standard (RFS) on independent refiners… We urge you to take up the Safeguarding Domestic Energy Production and Independence Act…to provide relief from runaway RFS compliance costs resulting from distorted RIN credit prices.”

Fitzpatrick noted that since its inception, large multinational companies have dominated the RIN market due to their extensive blending capabilities. Consequently, mid-size refiners face unsustainable credit prices as they cannot generate sufficient RINs independently.

East Coast refineries have experienced closures over recent decades due to these economic pressures. The proposed act aims to stabilize this situation by ensuring affordable access to necessary credits while continuing ethanol consumption.

Revenue from sold credits will be reinvested into advanced biofuels development for refiners, biofuel crop investments for farmers, and ecosystem restoration through the Habitat and Wildlife Restoration Fund.

Fitzpatrick concluded: “The Safeguarding Domestic Energy Production & Independence Act is a targeted solution that will address specific market failures within the current RFS structure… I look forward to working with you…on advancing this important priority on behalf of our Nation’s energy workers.”