Amicus Curiae Brief — HollyFrontier Cheyenne Refining, LLC, et al., Petitioners v. Renewable Fuels Association, et al.

No. 20-472

IN THE

Supreme Court of the United States

HOLLYFRONTIER REFINING & MARKETING LLC, et al.,

Petitioners,

v.

RENEWABLE FUELS ASSOCIATION, et al.,

Respondents.

ON WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE TENTH CIRCUIT

BRIEF FOR GROWTH ENERGY AND AMERICAN

FARM BUREAU FEDERATION

AS AMICI CURIAE IN SUPPORT OF

RESPONDENTS

JOSEPH S. KAKESH

GROWTH ENERGY

701 8th St., NW

Suite 450

Washington, DC 20001

(202) 545-4025

ELLEN STEEN

TRAVIS CUSHMAN

AMERICAN FARM BUREAU

FEDERATION

600 Maryland Ave., SW

Suite 1000W

Washington, DC 20024

(202) 406-3600

SETH P. WAXMAN

Counsel of Record

DAVID M. LEHN

WILMER CUTLER PICKERING

HALE AND DORR LLP

1875 Pennsylvania Ave., NW

Washington, DC 20006

(202) 663-6000

seth.waxman@wilmerhale.com

TABLE OF CONTENTS

Page

TABLE OF AUTHORITIES ........................................... ii

INTEREST OF AMICI CURIAE................................... 1

SUMMARY OF ARGUMENT ......................................... 3

ARGUMENT ....................................................................... 4

I.

THE INTERPRETATION EPA APPLIED TO

DECIDE PETITIONERS’ EXEMPTION PETITIONS IS OWED NO CHEVRON DEFERENCE .............. 4

II. THE STATUTE PERMITS EPA TO GRANT AN

EXEMPTION PETITION FOR A GIVEN YEAR

ONLY IF THE REFINERY HAS BEEN

EXEMPT FOR ALL PRIOR YEARS ............................... 10

A. The Statute Permits EPA to “Extend”

the “Temporary Exemption” Granted

by Congress ......................................................... 11

B. The Statute’s Text and Structure Show

Congress Used “Extend” and “Extension” to Mean “Prolong” ..................................... 12

C. The Statute’s Purpose Is Served by the

Court of Appeals’ Interpretation, Not

by Petitioners’ ..................................................... 18

III. EPA MUST IMPOSE REMEDIAL RFS

OBLIGATIONS TO CORRECT THE UNLAWFUL EXEMPTION EXTENSIONS ................................ 20

CONCLUSION ................................................................. 23

ii

TABLE OF AUTHORITIES

CASES

Page(s)

American

Fuel

&

Petrochemical

Manufacturers v. EPA, 937 F.3d 559 (D.C.

Cir. 2019) ...................................................................... 21

Americans for Clean Energy v. EPA, 864 F.3d

691 (D.C. Cir. 2017) .........................................18, 21-22

Barnhart v. Walton, 535 U.S. 212 (2002) ......................... 6

BNSF Railway Co. v. Loos, 139 S. Ct. 893

(2019) .............................................................................. 5

Brown v. Gardner, 513 U.S. 115 (1994) .................... 12, 14

Epic Systems Corp. v. Lewis, 138 S. Ct. 1612

(2018) ............................................................................ 10

Gonzales v. Oregon, 546 U.S. 243 (2006) .......................... 4

Hermes Consolidated, LLC v. EPA, 787 F.3d

568 (D.C. Cir. 2015) .................................................... 18

Kaufman v. Nielsen, 896 F.3d 475 (D.C. Cir.

2018) ............................................................................... 6

King v. Burwell, 576 U.S. 473 (2015) .............................. 12

Kisor v. Wilkie, 139 S. Ct. 2400 (2019) ........................... 10

Landgraf v. USI Film Products, 511 U.S. 244

(1994) ............................................................................ 22

Lozano v. Montoya Alvarez, 572 U.S. 1 (2014) ....... 16, 18

National Cable & Telecommunications Ass’n

v. Brand X Internet Services, 545 U.S. 967

(2005) .............................................................................. 4

iii

TABLE OF AUTHORITIES—Continued

Page(s)

Neustar, Inc. v. FCC, 857 F.3d 886 (D.C. Cir.

2017) ............................................................................... 5

Nijhawan v. Holder, 557 U.S. 29 (2009) ......................... 14

Nixon v. Missouri Municipal League, 541 U.S.

125 (2004) ..................................................................... 13

Pereira v. Sessions, 138 S. Ct. 2105 (2018) .................... 13

Quarles v. United States, 139 S. Ct. 1872 (2019)........... 19

Return Mail, Inc. v. United States Postal

Service, 139 S. Ct. 1853 (2019) .................................. 14

Skidmore v. Swift & Co., 323 U.S. 134 (1944).................. 4

State Farm Fire & Casualty Co. v. United

States ex rel. Rigsby, 137 S. Ct. 436 (2016) ........15-16

Taniguchi v. Kan Pacific Saipan, Ltd.,

566 U.S. 560 (2012) ..................................................... 12

United States v. Mead Corp., 533 U.S. 218

(2001) .............................................................................. 5

Wos v. E.M.A. ex rel. Johnson, 568 U.S. 627

(2013) ............................................................................ 10

Yates v. United States, 574 U.S. 528 (2015) ................... 13

STATUTES AND RULES

42 U.S.C. §7545 ......................................................... passim

Energy Policy Act of 2005, Pub. L. No. 58,

119 Stat. 594 ...........................................................14-15

Federal Rule of Civil Procedure 6 .................................. 17

Sup. Ct. R. 14.1..................................................................... 5

iv

TABLE OF AUTHORITIES—Continued

Page(s)

REGULATIONS AND ADMINISTRATIVE

MATERIALS

40 C.F.R.

§ 80.1401 ......................................................................... 7

§ 80.1441 ..................................................................... 7, 9

Regulation of Fuels and Fuel Additives: RFS

Pathways II and Technical Amendments

to the RFS 2 Standards, 78 Fed. Reg.

36,042 (June 14, 2013) ................................................... 8

Regulation of Fuels and Fuel Additives: RFS

Path-ways II, and Technical Amendments

to the RFS Standards and E15 Misfueling

Mitigation Requirements, 79 Fed. Reg.

42,128 (July 18, 2014).................................................... 9

Denial of Petitions for Rulemaking to Change

the

RFS

Point

of

Obligation,

(Nov. 22, 2017), https://www.regula

tions.gov/document/EPA-HQ-OAR-20160544-0525 ..................................................................... 19

Renewable

Fuel

Standard

Program:

Standards for 2018 and Biomass-Based

Diesel Volume for 2019, 82 Fed. Reg.

58,486 (Dec. 12, 2017) ................................................. 20

Renewable

Fuel

Standard

Program:

Standards for 2020 and Biomass-Based

Diesel Volume for 2021, Response to the

Remand of the 2016 Standards, and Other

Changes, 84 Fed. Reg. 36,762 (July 29,

2019) ............................................................................. 21

v

TABLE OF AUTHORITIES—Continued

Page(s)

Renewable

Fuel

Standard

Program:

Standards for 2020 and Biomass-Based

Diesel Volume for 2021 and Other

Changes, 85 Fed. Reg. 7016 (Feb. 6, 2020) ......... 1, 23

EPA, Available RINs, https://www.epa.gov/

fuels-registration-reporting-and-com

pliance-help/available-rins ....................................... 23

EPA, RFS Small Refinery Exemptions

https://www.epa.gov/fuels-registrationreporting-and-compliance-help/rfssmall-refinery-exemptions

(updated Mar. 18, 2021) ............................. 2, 7, 23

DOCKETED CASE MATERIALS

Americans for Clean Energy v. EPA,

No. 16-1005 (D.C. Cir.) ............................................... 21

Dakota Prairie Refining, LLC v. EPA,

No. 16-2692 (8th Cir.) ................................................... 9

RFS

Power

Coalition

v.

EPA,

No. 20-1046 (D.C. Cir.) ........................................... 2, 23

OTHER AUTHORITIES

Dictionary.com, https://www.dictionary.com ................ 12

INTEREST OF AMICI CURIAE1

Growth Energy is the leading association of domestic ethanol producers. “Today, nearly all gasoline used

for transportation purposes contains 10 percent ethanol.” Renewable Fuel Standard Program: Standards

for 2020 and Biomass-Based Diesel Volume for 2021

and Other Changes, 85 Fed. Reg. 7016, 7017 (Feb. 6,

2020). Because the Renewable Fuel Standard (“RFS”)

defines the minimum domestic demand for renewable

fuel, see 42 U.S.C. §7545(o)(2)(B) & (3), Growth Energy

has a strong interest in EPA’s administration of the

RFS program. Growth Energy regularly participates

in RFS-related rulemakings and lawsuits.

The American Farm Bureau Federation (“AFBF”)

is the largest nonprofit general farm organization in the

United States. Representing about six million member

families in all fifty states and Puerto Rico, AFBF’s

members grow and raise every type of agricultural

crop and commodity produced in the United States.

AFBF seeks to build a sustainable future of safe and

abundant food, fiber, and renewable fuel for our nation

and the world. AFBF regularly participates in litigation, including as amicus curiae, to represent its members’ interests.

In recent years, EPA’s administration of RFS exemptions for “small refineries” has become especially

important. Initially, the number of exempt small refineries dwindled from fifty-nine for 2010 to seven for

1

No counsel for a party authored this brief in whole or in

part, and no entity or person, other than amici curiae, their members, and their counsel, made a monetary contribution intended to

fund the preparation or submission of this brief. The parties have

consented to the filing of this brief.

2

2015. RFS Small Refinery Exemptions, Table 2.2 The

volume of renewable fuel covered by those exemptions

was marginal: 190 million gallons for 2013; 210 million

gallons for 2014; and 290 million gallons for 2015. Id.,

Table 1. But then the trend reversed dramatically: 19

exempt refineries covering 790 million gallons for 2016;

for 2017, 35, covering 1.82 billion gallons; and for 2018,

32, covering 1.54 billion gallons. Id., Tables 1 & 2.

Because all the extension petitions for 2016-2018

were granted after EPA had finalized the renewablevolume obligations for those years, and because EPA

has not increased subsequent volume obligations to offset the exempted volumes, those exemption extensions

substantially reduced the demand for ethanol (and other renewable fuels).3 But if EPA had applied the lower

court’s statutory interpretation—that a refinery is eligible for an exemption extension for a given year only if

it was exempt for the prior year—then no more than

two refineries could have received exemption extensions after 2015, see U.S. Br. 24, and the extensions’ effect on renewable-fuel demand would have remained

negligible.

It is critical to amici’s members, therefore, that the

judgment be affirmed.

2

https://www.epa.gov/fuels-registration-reporting-andcompliance-help/rfs-small-refinery-exemptions (updated Mar. 18,

2021).

3

See Initial Brief for the Biofuels Petitioners 13-23, RFS

Power Coalition v. EPA, No. 20-1046 (D.C. Cir. Jan. 29, 2021),

ECF No. 1882940 (“Growth Energy D.C. Cir. Br.”) (arguing that

EPA was required to increase subsequent RFS volume requirements to make up for prior exemption extensions).

3

SUMMARY OF ARGUMENT

I. The interpretation EPA applied to decide petitioners’ extension petitions is not owed Chevron deference, for several reasons. First, petitioners waived the

issue. Second, EPA’s interpretation was not adopted in

the exercise of its lawmaking authority. Indeed, EPA’s

2014 exemption-eligibility regulation, which petitioners

cite, actually accords with the court of appeals’ position

that a refinery is eligible for an extension for a given

year only if it was exempt for the prior year. Third,

EPA’s interpretation contradicts Congress’s clear intent on the issue and anyway is unreasonable. Finally,

the interpretation EPA applied no longer reflects

EPA’s considered position.

II. Petitioners’

preferred

interpretation—

“grant”—is clearly incorrect. It is obscure. It would

render the statute absurd: Congress would not have

intended to say that a refinery could “petition … for a

grant of the exemption under subparagraph (A),” given

that Congress already granted that exemption. And it

would not have been chosen for that purpose given the

obvious and more direct alternatives: “grant” or “renewal” instead of “extension,” or simply “petition … for

an exemption.” Moreover, Congress would not have

intended “extension” to mean “grant” in one single

provision when it consistently used “extend” and “extension” to mean “prolong” in the related provisions

governing small-refinery exemptions, in the Act

through which those provisions were enacted, and in

§7545 more broadly. Finally, the lower court’s interpretation does not treat the exemption provision as a

statutory sunset.

Additionally, the lower court’s interpretation, not

petitioners’, serves the principal statutory purpose of

4

forcing the market to use annually increasing amounts

of renewable fuel. Providing an exemption in the RFS

program’s initial years afforded refineries ample opportunity to prepare to meet their escalating RFS obligations, given that those obligations were specified in the

statute. Allowing refineries to obtain exemptions in

later years after achieving compliance would render the

statute self-defeating.

III. Should the Court affirm the lower court’s interpretation, it should clarify that on remand, EPA

must issue a remedial obligation requiring the exempted refineries to submit the number of RINs they would

have been required to submit had they not received the

unlawful extensions. Otherwise, judicial review of

EPA actions granting relief from RFS obligations will

be useless.

ARGUMENT

I.

THE INTERPRETATION EPA APPLIED TO DECIDE PETITIONERS’ EXEMPTION PETITIONS IS OWED NO CHEVRON DEFERENCE

For several reasons, the Court should not accord

Chevron deference to the interpretation EPA applied

to decide the extension petitions. Instead, the Court

should adopt “the best statutory interpretation.” National Cable & Telecommunications Ass’n v. Brand X

Internet Servs., 545 U.S. 967, 980 (2005).4

4

The Court has sometimes said that where Chevron deference is not owed, “the [agency’s] interpretation is ‘entitled to respect’ only to the extent it has the ‘power to persuade.’” Gonzales

v. Oregon, 546 U.S. 243, 256 (2006) (quoting Skidmore v. Swift &

Co., 323 U.S. 134, 140 (1944)). That is not deference in any meaningful sense, see id. at 269, and as explained herein, EPA’s interpretation is not persuasive.

5

1. Petitioners waived the question of whether

EPA’s interpretation might be due Chevron deference.

“Only the questions set out in the petition, or fairly included therein, will be considered by the Court.” R.

14.1(a). Petitioners failed to mention deference in their

certiorari petition, and the question petitioners did present—what the statute means—does not include the

deference question. See, e.g., BNSF Ry. Co. v. Loos,

139 S. Ct. 893, 908-909 (2019) (Gorsuch, J., dissenting)

(noting Court adopted “independent judicial interpretation” where petitioner “devoted scarcely any of its

briefing to Chevron”); Neustar, Inc. v. FCC, 857 F.3d

886, 894 (D.C. Cir. 2017) (agency “did not invoke [Chevron deference] with respect to rulemaking” and therefore “forfeited any claims to Chevron deference”).

2. In any event, petitioners’ Chevron-deference

claim founders at so-called step zero. An agency’s statutory interpretation “qualifies for Chevron deference

when it appears that Congress delegated authority to

the agency generally to make rules carrying the force

of law, and that the agency interpretation claiming deference was promulgated in the exercise of that authority.” United States v. Mead Corp., 533 U.S. 218, 226-227

(2001) (emphasis added). EPA did not promulgate its

interpretation in the exercise of its lawmaking authority.

First, the interpretation was implemented not

through a rulemaking or formal adjudication, but

through informal adjudications: the resolution of petitioners’ and others’ petitions for exemption extensions.

See Mead, 533 U.S. at 230 (“the overwhelming number

of our cases applying Chevron deference have reviewed

the fruits of notice-and-comment rulemaking or formal

adjudication” (emphasis added)).

6

Second, other indicia that the interpretation was

adopted through the exercise of EPA’s lawmaking

power are absent. See Barnhart v. Walton, 535 U.S.

212, 222 (2002) (considering “the interstitial nature of

the legal question, the related expertise of the Agency,

the importance of the question to administration of the

statute, the complexity of that administration, and the

careful consideration the Agency has given the question over a long period of time”). EPA’s interpretation

was not longstanding, but rather apparently was

adopted contemporaneously with its disposition of the

exemption petitions. Cf. Pet. App. 71a-72a. The task of

interpreting the common, non-technical words “extend”

and “extension” does not implicate EPA’s expertise.

EPA never articulated any analysis supporting its interpretation or otherwise showed that it gave the issue

careful consideration. And EPA never announced its

interpretation publicly. See, e.g., Kaufman v. Nielsen,

896 F.3d 475, 484 (D.C. Cir. 2018) (interpretation applied in informal adjudication not entitled to Chevron

deference in light of Barnhart factors).

Petitioners argue (Br. 46-49) that a 2014 EPA regulation “necessarily embodied” EPA’s interpretation and

thus qualifies for Chevron deference. Neither the regulation’s text nor its preamble directly addressed the

meaning of “extend” and “extension.” Yet, drawing

heavily on the preamble, petitioners claim (Br. 48-49)

that its eligibly requirements “presuppos[e]” that a prior “lapse” in exemption is not disqualifying. Petitioners

are incorrect; the regulation’s text and preamble actually refute petitioners’ reading.

The regulation provides that to be eligible for an

exemption extension for a given year, a refinery must

be “projected” to qualify as a “small refinery” for that

year and must have qualified as a “small refinery” for

7

the prior year. 40 C.F.R. § 80.1441(e)(2); see 40 C.F.R.

§ 80.1401 (defining “small refinery”). That structure is

identical to, and reinforces, the lower court’s view that

an extension may be granted for a given year only if the

refinery was exempt for the prior year, because only

then is there something to extend. The court’s interpretation functions as a “continuity requirement” when

applied year after year from the beginning: a refinery

that was exempt for year 1 may be eligible for an extension for year 2; a refinery that was exempt for year

2 may be eligible for an extension for year 3, and so on;

but a refinery that is not exempt for any given year will

never be eligible again. Similarly, the regulation’s eligibility rule in practice required continuity because,

although the regulation was not adopted until three and

a half years after the initial, “blanket” exemption expired, it appears that all exemption petitions granted

up to the time the regulation took effect were granted

to continuously exempt refineries.5

5

The blanket exemption, which ran through 2010, was granted to all fifty-nine extant small refineries. Office of Policy & Int’l

Affairs, Dep’t of Energy, Small Refinery Exemption Study at vii,

26 (Mar. 2011) (“2011 DOE Study”), https://www.epa.gov/sites/pro

duction/files/2016-12/documents/small-refinery-exempt-study.pdf;

see 42 U.S.C. §7545(o)(9)(A)(i). Next, EPA extended the exemption for thirteen of those refineries through 2012 based on the 2011

DOE Study, and separately granted individual petitions to extend

the exemption through 2012 for eleven of those refineries and

through 2011 for ten of them. U.S. Br. 7-8. Thus, the only refineries whose extension petitions were granted in the first round of

such petitions were ones that were exempt in the prior year and

therefore also qualified as a “small refinery” in that year. For the

next year—2013—EPA granted only eight exemption petitions.

RFS Small Refinery Exemptions, Table 2. The record does not

disclose whether all eight had also been exempt in 2011 and 2012,

but that is a reasonable assumption given that (i) the number of

exempt refineries for 2011 and 2012 was three times the number

8

Moreover, at a minimum, the 2014 regulation’s eligibility requirement accords with a continuity requirement going forward. That is, even if EPA, in promulgating the regulation, might have accepted that some

refineries could be eligible for a future exemption extension even though they had not qualified as a “small

refinery” in all prior years to that point, the regulation’s eligibility requirement would still have limited

eligibility for future extensions to those refineries that

thenceforth qualified as a “small refinery” continuously.

EPA might have thought that the statute should be interpreted to require continuous eligibility but that it

would be unfair to impose that on refineries that had

previously lost their exemption, out of concern that

such refineries might not have realized the consequences of such a lapse.

This reading of the regulation squares with EPA’s

explanation in the regulation’s preamble of why it

for 2013 and (ii) in 2013 EPA proposed to define “small refinery” as

a refinery whose average daily throughput “for calendar year 2006

and subsequent years” did not “exceed 75,000 barrels.” Regulation of Fuels and Fuel Additives: RFS Pathways II and Technical

Amendments to the RFS 2 Standards, 78 Fed. Reg. 36,042, 36,071

(proposed June 14, 2013). If EPA had already extended or was

about to extend exemptions for 2013 to refineries that had exceeded the throughput limit in 2011 or 2012 and therefore not been exempt for one or both of those years, it would have been passing

strange for EPA to propose an eligibility rule that would have disqualified those refineries for an extension for 2013 (or thereafter)

without mentioning that fact in its 2013 proposed rule or in its 2014

rejection of that proposal. And by the next year (2014), EPA had

finalized the eligibility regulation requiring that the refinery be a

“small refinery” in both the exemption year and the prior year. In

sum, it is likely that when the 2014 regulation’s eligibility rule became effective, all refineries that had received exemption extensions to date had been continuously exempt and thus also continuously qualified as a “small refinery.”

9

rejected its 2013 proposal. There, EPA said it would be

“unfair[]” to “disqualify a refinery … based only on a

single year’s production since 2006,” i.e., “in a single

year as much as 8 years ago.” Regulation of Fuels and

Fuel Additives: RFS Pathways II, and Technical

Amendments to the RFS Standards and E15 Misfueling Mitigation Requirements, 79 Fed. Reg. 42,128,

42,152 (July 18, 2014). But most of those years between

2006 and 2014 were covered by Congress’s blanket exemption. Thus, EPA’s concern was merely that a refinery that was a “small refinery” when the blanket exemption took effect (in 2006) and then exceeded the

75,000-gallon limit in a subsequent year before the regulation was promulgated (perhaps only during the pendency of the blanket exemption) should not be disqualified from obtaining an extension in the future. See id.

Addressing that concern does not necessarily contradict a continuity requirement going forward.

That the 2014 regulation is consistent with a continuity requirement is confirmed by the same regulatory

provision’s repeated reference to “an extension of its

small refinery exemption.” 40 C.F.R. § 80.1441(e)(2)

(emphasis added). The possessive “its” signals that a

refinery would be eligible for an exemption extension

only if it had been continuously exempt to that point,

for without an exemption in the prior year, an applicant

refinery would not possess an exemption to extend. See

Appendix A to Pet. for Review, Letter from Christopher Grundler, EPA, to Tim Michelson, Dakota Prairie

Refining, LLC at 1 & n.6 (Apr. 14, 2016) (stating 2014

regulation “allow[s] only small refineries that previously had received the initial exemption to qualify for an

extension of that exemption,” and emphasizing regulations’ use of “its”), Dakota Prairie Refining, LLC v.

10

EPA, No. 16-2692 (8th Cir. June 13, 2016), ECF No.

4412414 (p.8/17).

At worst, the 2014 regulation is inconclusive on the

issue and thus does not provide an authoritative agency

interpretation to which the Court could defer.

3. EPA’s interpretation does not deserve Chevron deference on the merits. First, Chevron “deference

is not due unless a court, employing traditional tools of

statutory construction,” including “traditional canons”

of interpretation, “is left with an unresolved ambiguity.” Epic Sys. Corp. v. Lewis, 138 S. Ct. 1612, 1630

(2018) (quotation cleaned). As explained below, the

statutory text, structure, and purpose evince Congress’s clear intent, leaving no ambiguity for EPA to

resolve. Second, even if the statute were ambiguous,

EPA’s resolution of that ambiguity would merit deference only if it “f[e]ll within the bounds of reasonable

interpretation.” Kisor v. Wilkie, 139 S. Ct. 2400, 2416

(2019). But EPA’s interpretation does not, for much

the same reasons that it contravenes Congress’s intent.

4. Finally, even if the interpretation applied to

the extension petitions at issue might have deserved

Chevron deference when it was applied, it does not today because it “no longer reflect[s] the agency’s position.” Wos v. E.M.A. ex rel. Johnson, 568 U.S. 627, 643

(2013); see U.S. Br. 46-47 & App. 36a-39a.

II. THE STATUTE PERMITS EPA TO GRANT AN EXEMPTION

PETITION FOR A GIVEN YEAR ONLY IF THE REFINERY

HAS BEEN EXEMPT FOR ALL PRIOR YEARS

The interpretive choice confronting the Court is

this: did Congress intend “extend” and “extension” as

used in 42 U.S.C. §7545(o)(9) to mean “increase the duration of something that already exists,” or “grant

11

something anew.” The former is supported by all the

relevant evidence; the latter, by none. Consequently,

under §7545(o)(9)(B), EPA may grant an extension petition for a given year only if the refinery was exempt

for the prior year, which (because that requirement

would apply year after year) means, in practice, only if

the refinery has been continuously exempt from the

start of the RFS program.

A. The Statute Permits EPA to “Extend” the

“Temporary Exemption” Granted by Congress

Congress began the RFS program with a blanket

“[t]emporary exemption”—one applied to all extant

small refineries—through 2010.

§7545(o)(9)(A)(i).

Congress then provided two mechanisms for an “extension of exemption.” §7545(o)(9)(A)(ii), (B)(i). First, the

statute provided that if the Secretary of Energy “determine[d]” that compliance with the RFS volume requirements “would impose a disproportionate economic

hardship on small refineries,” EPA could “extend the

exemption under clause (i) for the small refinery”—i.e.,

could extend the congressionally granted blanket exemption—“for a period of not less than 2 additional

years.” §7545(o)(9)(A)(ii). Second, the statute provided

that a “small refinery may at any time petition [EPA]

for an extension of the exemption under subparagraph

(A)”—i.e., could extend the “[t]emporary exemption”—

“for the reason of disproportionate economic hardship.”

§7545(o)(9)(B)(i).

12

B. The Statute’s Text and Structure Show

Congress Used “Extend” and “Extension” to

Mean “Prolong”

1. Ordinarily, the words “extend” and “extension”

denote an increase in the length of something. The dictionary provides good evidence of that: the first seven

definitions of “extend” on Dictionary.com (which draws

definitions primarily from the Random House Unabridged Dictionary, supplemented by the American

Heritage Dictionary and the Harper Collins Dictionary) all reflect a notion of “stretch[ing]” or “increas[ing]” something in space, effect, or time—i.e.,

“prolong.” Extend, Dictionary.com6; see “About,” Dictionary.com.7 This understanding of “extend” and “extension” implies preexistence; the length, duration, or

effect of something cannot be stretched or increased if

it has no length, duration, or effect.

Petitioners note (Br. 23, 28) that “‘extend’ can also

mean to ‘offer or make available,’” as in “‘grant.’” That

suffices neither to establish their preferred interpretation nor even to render the statute ambiguous. See

Brown v. Gardner, 513 U.S. 115, 118 (1994)

(“[a]mbiguity is a creature not of definitional possibilities but of statutory context”); accord King v. Burwell,

576 U.S. 473, 492 (2015). Again, the primary and most

common meaning of “extend” is “prolong”; the “grant”

meaning is quite uncommon, not appearing until Dictionary.com’s eighth definition of “extend.” A meaning

that is “not the ordinary meaning … does not control

unless the context in which the word appears indicates

that it does.” Taniguchi v. Kan Pac. Saipan, Ltd., 566

6

7

https://www.dictionary.com/browse/extend.

https://www.dictionary.com/e/about/.

13

U.S. 560, 569 (2012). Here, as explained presently, all

the contextual clues refute petitioners’ contention that

Congress intended to use their cherrypicked definition.

2. The statute describes the exemption to be extended in temporal terms.

The Act defines a

“[t]emporary exemption,” which Congress initially

granted only through 2010. §7545(o)(9)(A). Then, the

Act permits EPA to “extend the exemption under

clause (i)”—i.e., the exemption Congress granted

through 2010—“for a period of … additional years.”

§7545(o)(9)(A)(ii)(II). Indeed, petitioners concede (Br.

27) that these provisions “made clear that [Congress]

envisioned a temporal extension of that preexisting exemption.”

Yet, petitioners assert (Br. 27) that there is “no

reason” to conclude Congress assigned the same meaning to “extension” in subparagraph (B) of §7545(o)(9),

the provision governing individual extension petitions.

In fact, there are many such reasons. For starters, replacing “extension” with “grant” renders subparagraph

(B) absurd. The statute would say that a refinery could

“petition … for a grant of the exemption under subparagraph (A).” But “the exemption under subparagraph

(A)” was already granted by Congress when it enacted

the statute. Under petitioners’ interpretation, then,

petitioning for an “extension” under subparagraph (B)

would be an act of futility: requesting something the

refinery already received. The Court “will not construe

a statute in a manner that leads to absurd or futile results.” Nixon v. Missouri Mun. League, 541 U.S. 125,

138 (2004); accord Pereira v. Sessions, 138 S. Ct. 2105,

2115-2116 (2018). Petitioners can avoid this problem

only by impermissibly rewriting the statutory phrase

“the exemption under subparagraph (A)” as simply “an

exemption.” See Yates v. United States, 574 U.S. 528,

14

543 (2015) (Ginsburg, J., plurality op.) (“The canon

against surplusage is strongest when an interpretation

would render superfluous another part of the same

statutory scheme.” (quotations cleaned)).

Another obvious problem with petitioners’ desire

to give “extension” a different meaning in subparagraph (B) than in subparagraph (A) is that Congress

does not write statutes that way. “Where … Congress

uses similar statutory language and similar statutory

structure in two adjoining provisions, it normally intends similar interpretations.” Nijhawan v. Holder,

557 U.S. 29, 39 (2009). Here, though, where the language is not just similar but identical—e.g., “Extension

of exemption” appears in both, §7545(o)(9)(A)(ii)(II) &

(B)(i)—and where the adjoining provisions are highly

related substantively and cross-referenced, the Court

should not entertain the possibility that Congress intended to give the same word different meanings in the

two subparagraphs absent very clear and conclusive

evidence of such intent—and there is none. See Brown,

513 U.S. at 118 (“[t]extual cross-reference confirms”

Congress intended consistent meaning).

The broader statutory context confirms that Congress intended “extension” to have a consistent meaning across subparagraphs (A) and (B). “The consistentusage canon breaks down where Congress uses the

same word in a statute in multiple conflicting ways, Return Mail, Inc. v. United States Postal Serv., 139 S. Ct.

1853, 1865 (2019), but here Congress used “extend” and

“extension” consistently to indicate prolonging something that already exists. That is true of the Energy

Policy Act of 2005, in which Congress enacted the exemption provisions. See Pub. L. No. 109-58, §1501(c)(2),

119 Stat. 594, 1075 (“extension of effective date … extend the effective date … for not more than 1 year”

15

(codified at §7545(h)(5)(C)(ii))); Pub. L. No. 109-58,

§1507(4), 119 Stat. at 1082 (“extension of commencement date … extend the commencement date … for not

more than 1 year” (codified at §7545(k)(6)(B)(iii))). And

it is true of the rest of §7545. See §7545(k)(6)(A)(ii)

(“extend the effective date … for one additional year,

and may, by rule, renew such extension for 2 additional

one-year periods”); §7545(m)(3)(C)(ii) (“extend such effective date for one additional year”); §7545(o)(7)(E)(iii)

(“Extensions” “for up to an additional 60-day period”);

§7545(t)(2)(B) (“shall extend for a period of no more

than 10 consecutive calendar days”).

If Congress had intended subparagraph (B) to empower EPA to grant a new exemption irrespective of

whether the refinery was exempt for the prior year,

Congress had two easy and obvious ways to do so: by

using the word “grant” instead of “extension” or simply

by allowing refineries to petition “for an exemption”—a

locution that would have been perfectly clear and functional even though Congress provided a blanket exemption initially. Indeed, Congress used “grant” in

many other provisions of the Energy Policy Act and of

§7545 more broadly that authorize EPA to relieve a

regulated entity of its duties.

See, e.g.,

§ 7545(c)(4)(C)(ii)(III) (“grant the waiver”); §7545(f)(4)

(“grant or deny an application”); §7545(k)(1)(B)(iv)

(“the granting and use of credits”); §7545(k)(7)(A) (“the

granting of an appropriate amount of credits”);

§7545(m)(3)(C)(ii) (“waiver may be granted”);

§7545(o)(7)(C) (“waiver granted”). Thus, Congress

“knew how to draft the kind of statutory language that

petitioner[s] seek[] to read into” subparagraph (B).

State Farm Fire & Cas. Co. v. United States ex rel.

Rigsby, 137 S. Ct. 436, 443-44 (2016). “[H]ad Congress

intended to” give EPA the power to grant new exemp-

16

tions, it “would have said so.” Id. Particularly because

these are such “obvious alternative[s],” “the natural

implication” of Congress’s decision not to use them is

that Congress did not intend to give “extend” and “extension” such meaning. Lozano v. Montoya Alvarez,

572 U.S. 1, 16 (2014).

3. Petitioners’ textual counter-arguments have no

merit, and certainly not enough to outweigh the evidence just discussed.

First, petitioners’ “most significant[]” evidence—

subparagraph (B)’s phrase “at any time,” Pet. Br. 33—

does not support their interpretation. Whether “the

word ‘any’ has an expansive meaning,” as petitioners

assert (id.), is irrelevant. The statute expressly provides that a “small refinery may at any time petition …

for an extension.” §7545(o)(9)(B)(i). Hence, the phrase

“at any time” plainly serves a different function from

what petitioners claim: specifying when a refinery can

request (and thus when EPA can grant) an extension

petition, not the period to be covered by the exemption.

See U.S. Br. 37-38.

Second, petitioners argue (Br. 28) that the reference in subparagraph (B)(iii) to “a hardship exemption”

shows that what refineries petition for is “a freestanding exemption.” That reading cannot be squared

with subparagraph (B)’s statement that the petition is

for “an extension of the exemption under subparagraph

(A).” §7545(o)(9)(B)(i). Petitioners are right that these

two clauses are “interchangeabl[e],” but that only

shows that the phrase “hardship exemption” is shorthand for an extension of the exemption granted (and

potentially extended) under subparagraph (A). Petitioners’ reading renders the phrase “an extension of the

17

exemption under subparagraph (A)” superfluous or

gibberish.

Third, petitioners contend (Br. 38) that, if Congress

intended to require that the refinery have been exempt

in the prior year, it could have written “for the reason

of continuing disproportionate economic hardship.”

True, but for all the reasons already stated, the text is

clear without the word “continuing.”

Fourth, and similarly, petitioners argue (Br. 33-34,

39-40) that “when Congress intends to sunset a regulatory exemption, it does so expressly.” That too may be

true, but it is irrelevant because a continuity requirement is not a sunset provision. Under the court of appeals’ interpretation, exemption extensions would be

available for as long as small refineries continue to suffer disproportionate economic hardship from RFS compliance.

Finally, petitioners contend (Br. 29) that, even if

Congress used “extend” in a “temporal sense,” it still

allows for a “non-continuous extension.” This argument fails for several reasons. For starters, petitioners

strain to identify examples supporting that understanding of “extend.” The dictionary definition they quote

(Br. 29)—“an increase in length of time: increased or

continued duration”—actually refutes their argument,

because both an increase and a continuation imply that

the object of the extension already exists. Petitioners

invoke (Br. 29) Federal Rule of Civil Procedure

6(b)(1)(B), but that rule speaks not to discontinuity but

to whether a deadline can be extended after it has expired; the rule permits extensions after expiration of

the deadline, but even then, the extension creates an

enlarged, continuous period for action. The same is

true of petitioners’ “hypothetical tax benefit.” Pet.

18

Br. 30. Petitioners do identify (Br. 30) two statutes in

which Congress used “extend” or “extension” to indicate a discontinuous renewal of a benefit. Those statutes, however, establish at most that using “extend”

and “extension” that way is exceedingly rare and

should not be presumed to reflect Congress’s intent.

Moreover, if Congress had intended to allow discontinuous “extensions,” there would have been a much

easier and more natural way to express that intent: by

allowing a refinery to petition “for a renewal of the exemption.” Again, Congress’s decision not to adopt an

“obvious alternative” implies that it did not intend to

imbue its chosen language with that meaning. Lozano,

572 U.S. at 16.

C. The Statute’s Purpose Is Served by the Court

of Appeals’ Interpretation, Not by Petitioners’

The RFS program’s “increasing [volume] requirements are designed to force the market to create ways

to produce and use greater and greater volumes of renewable fuel each year.” Americans for Clean Energy

v. EPA, 864 F.3d 691, 710 (D.C. Cir. 2017) (Kavanaugh,

J.) (quotation cleaned). As the court of appeals recognized, that purpose is served by interpreting the statute to permit EPA to grant an extension petition for a

given year only if the refinery was exempt in the prior

year. That interpretation “funnels small refineries toward compliance over time”; as small refineries attain

the ability to meet their RFS obligations, the “number

[of exemptions] should … taper[] down.” Pet. App. 68a;

see Hermes Consol., LLC v. EPA, 787 F.3d 568, 572,

578 (D.C. Cir. 2015). Without a continuity requirement,

small refineries would have little incentive to make the

sustained investment needed to meet their RFS obliga-

19

tions for the duration of the program; they could elect

to do so when convenient and avoid their obligations

when they considered the requisite investment too

great.

Petitioners, however, contend (Br. 40) that phasing

out exemptions is contrary to the statute’s “escalating

burdens” on obligated parties. As petitioners see it

(Br. 40-43), the need for exemption increases as the

RFS volume obligations increase, and a refinery’s “ability to demonstrate compliance in one year will not be

dispositive of its ability to do so in a future year, especially with escalating compliance obligations.” This

makes no sense for two reasons. First, by laying out

the increasing volume requirements in the statute,

Congress gave obligated parties ample lead time to

prepare to meet them even as they escalate. See

§7545(o)(2)(B). If compliance is too difficult as the requirements increase, that is only because the refinery

has failed to make the necessary investments that Congress intended the program to force. Offering exemptions in the initial years of the program gives obligated

parties ample opportunity to prepare for compliance

over the long-haul; allowing obligated parties that have

achieved compliance to nonetheless secure exemptions

in later years only relieves them of the duty to take the

actions necessary to increase renewable-fuel use. The

Court “should not lightly conclude that Congress enacted a self-defeating statute.” Quarles v. United

States, 139 S. Ct. 1872, 1879 (2019).

Second, for a refinery able to achieve compliance,

the marginal financial effect of increasing volume requirements in later years should be negligible. EPA

has repeatedly found—based on extensive empirical

analysis—that obligated parties fully recoup their RIN

costs. Denial of Petitions for Rulemaking to Change

20

the RFS Point of Obligation 22-29 (Nov. 22, 2017)8; see

Alon Ref. Krotz Springs, Inc. v. EPA, 936 F.3d 628,

649-652 (D.C. Cir. 2019) (per curiam) (affirming EPA’s

finding).9 Accordingly, “fluctuat[ions]” in RIN prices,

even if “radical[],” Pet. Br. 44, have no appreciable financial effect on small refineries. If a small refinery

would face compliance difficulty from, as petitioners

assert (Br. 41, 43-44), “basic structural impediments

that do not diminish over time,” Congress could reasonably have expected that the refinery would either

remedy those impediments in the initial years of the

program—principally during the blanket-exemption

period—or never, in which case the refinery might

qualify for continued exemptions.

III. EPA MUST IMPOSE REMEDIAL RFS OBLIGATIONS TO

CORRECT THE UNLAWFUL EXEMPTION EXTENSIONS

Should the Court uphold the lower court’s interpretation, almost all exemption extensions for 2016,

2017, 2018, and 2019 will immediately become invalid.

See U.S. Br. 24.10 Because EPA has not “adjust[ed]

renewable fuel obligations to account for” those extensions, they created a “renewable-fuel shortfall,”

“imped[ing] attainment of overall applicable volumes.”

8

https://nepis.epa.gov/Exe/ZyPDF.cgi?Dockey=P100TBGV.pdf.

9

See also Renewable Fuel Standard Program: Standards for

2018 and Biomass-Based Diesel Volume for 2019, 82 Fed. Reg.

58,486, 58,517 (Dec. 12, 2017); Renewable Fuel Standard Program—Standards for 2020 and Biomass-Based Diesel Volume for

2021 and Other Changes: Response to Comments 11 (Dec. 2019),

https://nepis.epa.gov/Exe/ZyPDF.cgi?Dockey=P100YAPQ.pdf.

10

See also Petition for Waiver Under Clean Air Act Section

211(o)(7)(A)(i) of the Renewable Fuel Standard (“RFS”) at 4 (Mar.

30, 2020), https://www.epa.gov/sites/production/files/2021-01/

documents/rfs-waiver-petition-perkins-coie-2020-03-30.pdf.

21

American Fuel & Petrochemical Manufacturers v.

EPA, 937 F.3d 559, 571, 588 (D.C. Cir. 2019) (per curiam). Thus, EPA will need to remedy its unlawful decisions to grant those extensions. To ensure that the

Court’s decision has force and that there is meaningful

judicial review of relief EPA provides to obligated

parties under the RFS program, see 42 U.S.C.

§7607(b), the Court should make clear that on remand,

EPA must require the exempted refineries to submit

the number of RINs they would have been required to

submit had they not received the unlawful extensions.

The lower court stated that on remand, EPA would

“likely” take “action … at least partially redressing”

the unlawful extensions, such as by requiring “afterthe-fact retirements of RINs” by the formerly exempt

refineries. Pet. App. 49a-50a. But in the past EPA has

signaled that it could or would not remedy unlawfully

granted RFS relief. In Americans for Clean Energy,

the D.C. Circuit held unlawful EPA’s 500-million-gallon

waiver of the 2016 RFS volume requirement. 864 F.3d

at 696. EPA still has not remedied that error. See Order, No. 16-1005 (D.C. Cir. Jan. 27, 2021), ECF No.

1882107. On remand, EPA stated that “any [remedial]

approach that requires additional volumes of renewable

fuel use” would constitute “a retroactive standard” imposing “a significant burden on obligated parties, without any corresponding benefit as any additional standard cannot result in additional renewable fuel use in

2016.” Renewable Fuel Standard Program: Standards

for 2020 and Biomass-Based Diesel Volume for 2021,

Response to the Remand of the 2016 Standards, and

Other Changes, 84 Fed. Reg. 36,762, 36,788 (July 29,

2019). If EPA were correct that remediation could constitute an unreasonable retroactive obligation, judicial

review of EPA actions granting relief from RFS obliga-

22

tions, whether exemption extensions or waivers, would

be pointless. Thus, the Court should clarify that requiring unlawfully relieved obligated parties to comply with

future remedial obligations equal to the obligations

they would have had but for the unlawful relief would

not impose a retroactive standard at all, and certainly

not one that EPA can avoid imposing.

A standard is retroactive only if it “attaches new

legal consequences to events completed before its enactment.” Landgraf v. USI Film Prods., 511 U.S. 244,

269-270 (1994). But an obligation to remedy unlawful

RFS relief would be neither new nor retroactive. First,

a remedial obligation would simply restore the requirement that Congress intended and that EPA unlawfully relieved. Obligated parties cannot have “settled expectations” in a potentially unlawful agency decision to grant them relief from their congressionally

imposed RFS obligations. See id. at 266, 269 n.24, 270.

Second, a remedial obligation would apply in the future,

and surely EPA could set a deadline for compliance

that would afford obligated parties ample “notice” to

structure their conduct to achieve compliance. See id.

at 269 n.24, 270.

Moreover, obligated parties would not need to use

additional renewable fuel—in the past or in the future—to meet their remedial obligations. Instead, they

could use the available RINs in the so-called RIN bank

(the aggregation of RINs carried over from prior years

for compliance in future years). See Americans for

Clean Energy, 864 F.3d at 699. In fact, using banked

RINs is appropriate because it was the very unlawful

exemption extensions that enabled those RINs to be

banked in the first place. Thus, a remedial obligation

23

would restore the RIN bank’s balance to what it would

have been but for the unlawful exemption extensions.11

CONCLUSION

The judgment should be affirmed.

Respectfully submitted,

JOSEPH S. KAKESH

GROWTH ENERGY

701 8th St., NW

Suite 450

Washington, DC 20001

(202) 545-4025

SETH P. WAXMAN

Counsel of Record

DAVID M. LEHN

WILMER CUTLER PICKERING

HALE AND DORR LLP

1875 Pennsylvania Ave., NW

Washington, DC 20006

ELLEN STEEN

(202) 663-6000

TRAVIS CUSHMAN

AMERICAN FARM BUREAU seth.waxman@wilmerhale.com

FEDERATION

600 Maryland Ave., SW

Suite 1000W

Washington, DC 20024

(202) 406-3600

MARCH 2021

11

Because all or nearly all the 2016-2019 extensions were

granted after each covered compliance year ended, the exempted

refineries had already acquired the RINs needed for compliance.

Consequently, once those refineries received their extensions,

most or all the corresponding RINs went into the RIN bank. See,

e.g., 85 Fed. Reg. at 7021 & n.15. For those years, EPA has granted extensions covering 4.3 billion RINs. RFS Small Refinery Exemptions, Table 1. The RIN bank currently contains about the

same number of RINs.

See EPA, Available RINs,

https://www.epa.gov/fuels-registration-reporting-and-compliancehelp/available-rins. See generally Growth Energy D.C. Cir. Br. 1321, supra n.3.