A small refinery that previously received a hardship exemption may obtain an "extension" under §7545(o)(9)(B)(i) even if it saw a lapse in exemption coverage in a previous year.
Gorsuch, joined by Roberts, Thomas, Breyer, Alito, Kavanaugh
Dissent
Barrett, joined by Sotomayor, Kagan
HollyFrontier Cheyenne Refining, LLC v. Renewable Fuels Association, 594 U.S. ___ (2021), was a
United States Supreme Court case dealing with exemptions from blending requirements for small refineries set by the Renewable Fuel Standard program. The case dealt with the statutory interpretation
of the congressional language for extending the exemption, if this allowed a lapse in the exemption or not. In a 6–3 decision, the Supreme Court ruled that by the majority's interpretation of the law, the congressional law did allow for refineries to seek extensions after their exemption period had lapsed.
Background
Congress established the
Department of Energy (DOE) to study if there were disproportionate impacts of this blending requirements on the smaller refineries from which then the EPA could then grant extensions to the original exemption for smaller refiners. DOE did conclude that such hardships did exist, leading the EPA to begin issuing extensions of the original exemption, requiring the refinery to annually reapply for further extensions.[1]
The case at hand involves three small refineries who had either failed to file for an extension in 2011, or failed to renew their extension with the EPA: HollyFrontier Woods Cross Refining LLC, HollyFrontier Cheyenne Refining LLC, and Wynnewood Refining Company. After their exemption period has expired, the three refineries separately sought a new extension to the exemption from the EPA, which the EPA granted. As more exemptions were being passed during the
Tenth Circuit, where the court overturned the EPA's decision, stating the agency exceeded its authority, and agreed with the renewable fuel associations' assertion that by interpretation of "extension", there had to be an exemption to extend in place already.[1][2]
Supreme Court
The refineries petitioned to the Supreme Court to review the Tenth Circuit's ruling, and the case was granted certiorari in January 2021. Oral hearing were held on April 27, 2021.
The Court issued its decision on June 25, 2021. In a 6–3 decision, the Supreme Court reversed the Tenth Circuit's ruling, and concluded a refinery that had allowed their exemption period to lapse can still apply to extend to re-continue the exemption period. Justice
Chevron deference in that in absence of other standing language from Congress, that the EPA's interpretation of the congressional language have priority.[3]
Justice Amy Coney Barrett wrote a dissent joined by Sonia Sotomayor and Elena Kagan. Barrett argued that the majority's interpretation of the ordinary meaning of "extension" was incorrect, and that it was implied that this required the continuous exemption period to be in place to extend.[3]
