The U.S. Environmental Protection Agency (EPA) has granted 140 exemptions to small refineries under the Renewable Fuel Standard (RFS), with a mix of full and partial relief, while leaving some petitions pending.

Of the requests reviewed, 63 received full exemptions, 77 were partially approved, and 28 were denied. Seven petitions were considered ineligible, and 57 applications are still under review.

The EPA also announced plans to propose a rule reallocating gallons lost to exemptions beginning with the 2023 compliance year, while volumes from 2016 through 2022 will not be reallocated. The agency will clarify how exemptions will factor into biofuel blending targets for 2026 and 2027.

The exemptions correspond to 5.34 billion Renewable Identification Numbers (RINs). The EPA noted it is no longer assuming that all refiners can pass these costs onto consumers and recognized that some facilities may face higher compliance expenses.

Additionally, the agency reaffirmed its policy allowing previously retired RINs to be applied for prior-year compliance when a refinery receives an exemption for that period. However, credits from 2022 or earlier cannot count toward 2024 or future obligations.

The EPA continues to grant partial exemptions—up to 50%—for refineries demonstrating economic hardship, emphasizing a more tailored approach that reflects how different refineries are affected.

The ethanol and broader biofuel industry has expressed concern that mishandling these exemptions could reduce demand for renewable fuels. EPA records indicate more than 200 exemption petitions remain open, covering compliance years from 2016 to 2025.