On November 7, 2025, the EPA announced a new set of Small Refinery Exemptions (SREs) under the RFS. The decision covers 16 petitions from eight refineries for the 2021–2024 compliance years. The final tally:
- 2 full exemptions granted
- 12 partial (50%) exemptions granted
- 2 petitions denied
While the EPA described its recent decision as an effort to get the RFS program “back on track,” the move has sparked mixed reactions across the industry. Critics argue that the exemptions could weaken the program’s integrity, impact farmers, and add volatility to the market. Among those receiving exemptions were refineries owned by HF Sinclair and Phillips 66, while petitions from Chevron were denied.
The announcement quickly drew political attention. A multi-state coalition led by South Dakota Attorney General Marty Jackley, joined by counterparts from Iowa and Nebraska, has called for a federal investigation into the refiners that received exemptions. According to the group, some refiners have cited “disproportionate economic hardship” in their petitions to the EPA while simultaneously reporting high profits to investors.
“Renewable fuels are important to South Dakota’s economy, especially rural communities,” Jackley said. “If refineries are not following the rules, they hurt our state’s farmers and ethanol industry.”
Industry leaders shared similar concerns. Many in the renewable fuels sector warned that the decision could create additional uncertainty and confusion within the agricultural marketplace. Geoff Cooper, President and CEO of the Renewable Fuels Association (RFA), questioned whether the exemptions were justified at all. He pointed to EPA’s own data, which indicates that refiners (both large and small) typically pass RFS compliance costs through to consumers rather than absorbing them.
The primary concern centers on the RIN market. The 14 new full and partial exemptions are expected to reduce total Renewable Volume Obligations (RVOs) by roughly 740 million RINs across the 2021–2024 compliance years.
Cooper outlined two key parts of the EPA’s action:
- 2021–2022: The EPA is returning expired RINs to refineries. The RFA called this a “silver lining,” since it won’t directly affect the current market.
- 2023–2024: The agency will return more than 500 million valid RINs to refiners, which could expand supply.
When combined with earlier exemption decisions, this creates what the RFA describes as a potential surplus of more than 2.5 billion RINs tied to 2023–2025 SREs.
In response to criticism, the EPA defended its actions, saying the decisions align with the Clean Air Act and are consistent with its ongoing commitment to administer the RFS program. The agency explained that the recent SRE approvals stem from a long-standing commitment to review and process pending petitions. Its legal reasoning centers on two main points:
- Partial Exemptions: The EPA maintains that it has authority under the Clean Air Act to issue partial (50%) exemptions, rather than an all-or-nothing determination.
- DOE Deference: The agency relies on a Department of Energy (DOE) scoring matrix as a “reasonable proxy” for determining whether a refinery faces “disproportionate economic hardship.”
The EPA also reaffirmed its policy of returning previously retired RINs to refiners granted retroactive exemptions.
According to the agency, this is the most legally sound way to implement exemptions without adding new RINs into the system—thereby maintaining overall market stability.
As the industry continues to navigate shifting EPA decisions and evolving RFS requirements, staying organized and audit-ready is more important than ever. Tools like RINSTAR help renewable fuel producers, importers, and obligated parties manage compliance with confidence. We streamline EMTS reconciliation, tracking RIN volumes, and maintaining clear, accessible documentation. Whether the landscape brings new exemptions or updated reporting rules, RINSTAR ensures your team stays prepared, compliant, and focused on what matters most: keeping your renewable fuel operations moving forward.
