The Environmental Protection Agency sent a proposed rule to the White House
for review Dec. 15 that would establish a third-party verification system for
renewable fuel credits.
The proposed rule comes after 30 companies reached a settlement with EPA in
April in which they agreed to pay approximately $3.65 million in penalties after
they purchased fraudulent renewable identification numbers (RINs), serial
numbers that are assigned to batches of renewable fuel generated to satisfy the
renewable fuel standard. The renewable identification numbers can also be traded
After reaching that settlement, EPA said it intended to propose a
verification system to prevent fraudulent RINs from entering the marketplace.
The agency said the rule would include a system allowing third parties to audit
and verify the validity of the RINs being sold.
“One of the things we want is clarity,” Ben Evans, a spokesman for the
National Biodiesel Board, told BNA Dec. 17. “We want a good outline of what due
diligence is, so the parties can comply.”
In October, EPA issued a draft
quality assurance plan that set ongoing and quarterly monitoring
requirements for renewable fuel producers (212 DER A-16, 11/2/12).
The petroleum industry had pressed EPA to finalize its verification rule
before the start of the 2013 compliance year, but the agency said the draft
quality assurance plan will allow renewable fuel producers to verify the
validity of their renewable identification numbers until the rule can be
The draft plan would require ongoing monitoring of feedstocks, production
processes, and the number of gallons of renewable fuel being produced.
Additionally, the draft plan would require quarterly monitoring of work force
size, certificates of analysis verifying fuel types, and process quality
EPA's inspector general has begun its own investigation into whether EPA has
an effective system for managing renewable identification numbers (227 DER A-12,
In a related case, the Justice Department reported Dec. 14 that a Texas man
pleaded guilty to charges of wire fraud, money laundering, and making false
statements in violation of the Clean Air Act after falsely representing that he
was in the business of producing biodiesel fuel (seerelated story in this
By Andrew Childers
EPA's draft quality assurance plan issued in October is available at http://www.epa.gov/otaq/fuels/renewablefuels/documents/420b12063.pdf.
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