Will Trump Stand Up for American Refineries and Renewables?

Steve Sherman
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Posted: Sep 19, 2017 10:35 AM
Will Trump Stand Up for American Refineries and Renewables?

Donald Trump made a series of promises on the campaign trail. In recent days, the President has been facing increased heat as many of those promises remain unfulfilled. Trump has a unique opportunity to come through on one of those promises with the simple stroke of a pen.

During a speech in Pennsylvania President Trump made a promise, “I’m going to lift restrictions on American energy and allow this wealth to pour into our communities, including right here in the state of Pennsylvania.” The lifting of which restrictions would help communicates in Pennsylvania?  Restrictions that have harmed refineries in Pennsylvania and in the nation.

Two former Governors, Republican Tom Corbett and Democrat Ed Rendell co-wrote an op-ed on September 14, 2017 for the Inquirer, arguing that the Trump Administration should make good on the promise to Pennsylvania by saving refineries. They wrote the following: “We do, however, see an effective way to improve it: move the point of obligation under the RFS. With a stroke of the pen, the administration can preserve refineries in Pennsylvania and across the nation, protect tens of thousands of jobs, unleash billions in capital investment, safeguard consumers, and advance the cause of national security — all while maintaining the role that renewables have to play in our fuel supply. Not a bad way to keep a promise to the American people regarding our country’s energy.” 

The “point of obligation” is a legal term for the fact that refiners have a bureaucratic reporting requirement on the use of renewable fuels that has resulted in a stagnation in new refineries.

What does that mean to you as an American?

Most Americans would like to see the United States maintain an energy advantage when it comes to refining gas and increasing our use of renewables. The cost of gas at the pump is really where the campaign promises meet the voter. The President should do anything he can to keep costs from going up due to governmental pressures rather than true market forces. Americans also feel the effects of the current government policy in jobs.

Small American refineries are essential to getting gas to the pump at a good price. Those refineries also provide thousands of Americans with solid jobs.

The Renewable Fuel Standards (RFS) program requires the use of renewables in fuel supplies. It is a well-meaning program that aims to keep renewables in the mix for America’s fuel. Unfortunately, the Environmental Protection Agency (EPA) has complicated the system to the point it is virtually untenable.

The EPA uses a confusing system of credits called Renewable Identification Numbers or RINs. These credits are then used to verify the use of renewables. They are bought, sold, and traded in an environmental trading program that puts an undue amount of pressure on America’s refineries, especially the smaller ones. We can’t afford to lose any refineries. It is virtually impossible to build a new refinery in America thanks to over-regulation.

Without our refiners, all the crude or renewables in the world will be useless. With some simple tweaking, the RFS program can keep our refiners flourishing and support the up and coming renewables we need. It’s as simple as shifting the point of obligation from the refiners to the blenders. The blenders are companies who do just what it sounds like. They blend various types of gasoline and renewables. They are the ones who should be providing the EPA with verification of the use of renewables.

This simple move will lift undue and costly burdens from the refiners and require the blenders to provide the government with its required documentation of compliance. The blenders are the ones who are currently awarded the RINs, it only makes sense that the EPA enforce its obligations there rather than at the refineries.

This seems like an easy promise – low hanging fruit – for President Trump to complete in a way that will help job growth and lowering cost to consumers.