February 28, 2018, by Jarrett Renshaw
NEW YORK (Reuters) – U.S. President Donald Trump on Thursday will gather rivals from the oil and corn industries for the second time this week as the administration seeks elusive common ground on reforms to the nation’s controversial biofuels law.
The meetings come amid rising concern in the White House over the current state of the U.S. Renewable Fuel Standard (RFS), a law requiring refiners to mix biofuels such as corn-based ethanol into their fuel, which has increasingly divided two of Trump’s most important constituencies. A refining company, Philadelphia Energy Solutions (PES) in the key electoral state of Pennsylvania, last month blamed the regulation for its bankruptcy.
A meeting earlier in the week ended with Iowa Republican Senators Chuck Grassley and Joni Ernst calling the White House efforts to help refiners cope with the regulation a threat to farmers, and vowing to fight proposed changes.
Grassley and Ernst, along with Republican Senators Ted Cruz and Pat Toomey of refining states Texas and Pennsylvania, will be in attendance again on Thursday, according to two sources familiar with the planning of the event.
A number of companies will also be represented.
Executives from refiners Valero Energy Corp (VLO.N), Delta Air Lines’ (DAL.N), Monroe Energy and PBF Energy Inc (PBF.N) will be there along with a union representative from the bankrupt PES, the largest and oldest refiner on the East Coast, the sources said.
The biofuel industry will be represented by officials from major producers POET and Green Plains Inc (GPRE.O), along with others, the two sources said.
Trump will be joined by U.S. Environmental Protection Agency head Scott Pruitt and Interior Secretary Ryan Zinke, who will be sitting in for U.S. Agriculture Secretary Sonny Perdue as he attends events in California, they said.
Cruz’s office and POET confirmed attendance to Reuters. Representatives for the other parties, including the White House, either did not respond or declined to comment.
Under the RFS, refiners must cover the costs of blending increasing volumes of biofuels such as ethanol into the nation’s gasoline and diesel each year. To prove compliance with the program, they have to acquire credits called RINs, either by earning them through blending or by buying them.
The price of RINs has surged in recent years, meaning refiners without blending facilities have faced higher costs.
At Tuesday’s meeting, Grassley and Ernst were asked to consider accepting a proposed ceiling on the price of RINs in exchange for a concession to the ethanol that would allow broader sales of higher-ethanol gasoline blends.
“Senator Ernst and I suggested specific policy changes that would be a win-win for biofuels and oil. But we’ve made it clear all along that a cap or waiver credit for RINs would not be a win-win,” Grassley said following the meeting.
Perdue on Wednesday tried to calm fears among farmers that Trump is trying to reform the RFS in way that hurts the industry.
“I can tell you Trump stands with corn farmers, biofuel farmers and the RFS,” Perdue told an audience at the Commodity Classic in Anaheim, California, according to a recording heard by Reuters. “I stand with him and with you.”
Reporting by Jarrett Renshaw; Editing by Lisa Shumaker