US Supreme Court rules in favor of small oil refiners in fuel exemption case
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US Supreme Court rules in favor of small oil refiners in fuel exemption case

The U.S. Supreme Court held in a 6-3 ruling on Friday that small oil refineries that received an exemption from the Renewable Fuel Program (RFP) could continue to receive extensions of that exemption even if they had a lapse in the exemption the previous year.

The RFP requires most domestic refiners to blend certain amounts of renewable fuels, such as ethanol, into the transportation fuels that they refine. However, when these mandates were adopted in 2005 and 2007, Congress granted temporary exemptions to small refineries and authorized those refineries to apply for extensions at any time. The question in HollyFrontier Cheyenne Refining, LLC v. Renewable Fuels Assn. is whether a small refiner which managed to comply with the RFP mandate one year is then forever barred from applying for an extension of the exemption.

Justice Gorsuch wrote the opinion, joined by Chief Justice Roberts and Justices Thomas, Breyer, Alito, and Kavanaugh. Gorsuch found that the plain meaning of “extension” does not require continuity, and examined similar language in other statutes and regulations that suggest if Congress does not include limiting language like “consecutive” then continuity is not required. Examining the language of the RFP mandate specifically, he noted that Congress provided that small refineries could seek exemptions “at any time,” further indicating that the statute does not require continuity.

Justice Barrett wrote a dissent, joined by Justices Kagan and Sotomayor. She argued that the Environmental Protection Agency, which runs the RFP, “cannot ‘extend’ an exemption that a refinery no longer has.” She noted that the statute calls for only temporary exemptions, and read the term “extension” in light of that earlier language to mean “continuation.” Even though “extension” can refer to a post-lapse renewal of the exemption, Barrett argued that is not the most natural reading, and that just because a reading is possible does not make it the most likely choice. She would have held that once a refiner allowed the exemption to lapse, it would not be able to apply for an extension.