BIO rips US Justice Department’s proposed PES bailout: “Refiner sold credits to undermine RFS”

March 29, 2018 |

In Washington, the Biotechnology Innovation Organization submitted comments to the U.S. Department of Justice on the proposed Consent Decree and Environmental Settlement Agreement with the United States Bankruptcy Court for the District of Delaware in the case of Philadelphia Energy Solutions Refining and Marketing LLC and PES Holdings LLC.

Brent Erickson, executive vice president of BIO’s Industrial & Environmental Section, states, “Philadelphia Energy Solutions’ claim to the bankruptcy court that the Renewable Fuel Standard program caused its financial difficulties is specious at best. The record shows that the refiner ignored its RFS compliance obligations and sold renewable fuel credits for profit, in order to pay unearned dividends to its Wall Street shareholders. This proposed settlement agreement undermines the goals of the RFS by allowing the refiner to profit by escaping its obligations under the law.

“Under the proposed settlement agreement, Philadelphia Energy Solutions is escaping 329 million gallons of its 2016 and 2017 renewable fuel obligations along with its entire obligation for the first three-and-a-half months of 2018. Moreover, the refiner is being allowed to keep for future use 64.6 million renewable fuel credits that should be turned in. PES cynically claimed to the bankruptcy court that other refiners and fuel blenders were reaping windfall profits from selling renewable fuel credits to them. The record now shows that PES is reaping a windfall by breaking the rules.

“The RFS has been a success in opening the U.S. transportation fuel market to innovation and competition. Biofuel producers have made long-term investments to develop advanced and cellulosic biofuels, build infrastructure, and create new jobs and economic opportunity. The proposed settlement agreement represents an unwarranted transfer of wealth to PES and its Wall Street shareholders at the expense of these biofuel producers and their investors.”

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Category: Policy

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