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A coalition of U.S. farmers, ethanol producers and fuel retailers asked the Environmental Protection Agency to reject CVR Energy’s (NYSE:CVI) request to change the Renewable Identification Number trading program, Dow Jones reported Tuesday.
Two refineries owned by CVR Energy (CVI), Coffeyville and Wynnewood Refining, have requested the EPA initiate a rule that would restrict the obligated parties that can trade RINs, maintaining the current system allows for “an illegal RIN market where RINs trade at hundreds of times their production cost for the benefit of market speculators, criminals, large retail chain owners, and RIN long large vertically integrated refiners.”
In a letter to the EPA, the industry groups including the Renewable Fuels Association and the National Farmers Union said CVR’s (CVI) request is “contrary to [Renewable Fuel Standard] policy objectives [and] legally unmoored from any objective reading of the enabling statute,” while having “disastrous impacts on renewable fuel producers, fuel marketers and retailers, farmers, obligated parties, and consumers in the form of higher prices at the pump.”
The groups said a decision to limit the parties that could trade RINs would effectively result in a “wide gap between bids and offers for RINs,” and result in “far more volatile RIN markets, with highly concentrated market power in the hands of just a few market participants.”