Comment period opens on proposed PES RIN settlement

By Erin Voegele | March 21, 2018

On March 16, the U.S. Department of Justice opened a 10-day public comment period on a proposed settlement with Philadelphia Energy Solutions over its Renewable Fuel Standard compliance obligations. The settlement was outlined in documents filed with the U.S. Bankruptcy Court for the District of Delaware on March 12.

PES filed for Chapter 11 bankruptcy in January, blaming its financial struggles on RFS compliance costs, specifically the price of renewable identification numbers (RINs). Supporters of the U.S. biofuels industry argue that the refiner’s financial struggles are not due to its RFS compliance obligations, but rather mismanagement and bad business decisions. 

In the March 12 court filing, the U.S. EPA proposes as settlement under which PES would retire a total of 138 million currently held RINs in order to resolve its liability for renewable blending obligations (RVOs) prior to the effective date of its proposed plan of reorganization, retire 64.6 million RINs towards its post-bankruptcy 2018 RVO and agree to retire RINs on a semiannual basis for their post-effective date RVOs through 2022. The effective data is currently anticipated to be April 1.

The court filing states that the EPA “is not requesting any action by the court on the proposed settlement agreement. Instead, the proposed settlement agreement should remain lodged with the court while the United States provides an opportunity for public comment.”

The 10-day public comment period officially opened March 16 and will run through March 26. Comments may be submitted via email or mail. Additional information is available on the Federal Register website.