MOSCOW (MRC) -- President Joe Biden's administration, under pressure from labor unions and US senators including from his home state of Delaware, is considering ways to provide relief to US oil refiners from biofuel blending mandates, reported Reuters with reference to three sources familiar with the matter.
The issue pits two of the administration's important political constituencies against each other: blue-collar refinery workers and farmers who depend on biofuel mandates to prop up a massive market for corn.
It could prompt an about-face for the administration, which had been rolling back former President Donald Trump's dramatic expansion of waivers for US refiners from the Renewable Fuel Standard.
The law requires them to blend billions of gallons of ethanol and other biofuels into their fuel each year or buy credits from those that do. The credits, known as RINs, are currently at their highest price in the program's 13-year history, and refiners have said the policy threatens to bankrupt fuel makers already slammed by sinking demand during the pandemic.
Biofuel advocates counter that fuel makers should have invested in biofuel blending facilities years ago and can pass through added costs for buying credits.
Democratic senators Chris Coons and Tom Carper of Delaware have held at least two discussions in recent weeks with Michael Regan, head of the US Environmental Protection Agency, to discuss providing relief for refiners, according to the three sources.
Merchant refiners like PBF Energy, which operates the Delaware City plant, say biofuel laws could shut down plants and kill thousands of union jobs. The company recently shut most of its refinery in New Jersey, the latest in a series of shutdowns along the US East Coast. The region, which faces higher refining costs because of its distance from US oil fields, has seen fuel production capacity drop about 40% since 2000.
Federal data shows that only eight refineries remain out of the 17 that were operating on the US East Coast in 2000.
As MRC wrote previously, POET, the largest biofuels producer in the United States, is in discussions with Flint Hills Resources to acquire the entirety of Flint Hills’ ethanol assets. Flint Hills, a refining, biofuels and petrochemical company, is based in Wichita, Kansas, and is currently the fifth-largest ethanol producer in the United States. Its biofuels division includes six ethanol plants with a combined capacity of about 800 million gallons per year, 1.5 million tons of distillers grains and about 200 million pounds of corn oil, Reint said.
Ethylene and propylene are the main feedstocks for the production of polyethylene (PE) and polypropylene (PP), respectively.
According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 744,130 tonnes in the first four month of 2021, up by 4% year on year. Shipments of all PE grades increased. At the same time, PP deliveries to the Russian market were 523,900 tonnes in January-April 2021, up by 55% year on year. Supply of homopolymer PP and PP block copolymers increased, whereas shipments of PP random copolymers decreased.