CVR Refining CEO Jack Lipinski blasted the EPA over its Renewable Fuel Standard (RFS) program today, taking aim at renewable fuel credits he said are bringing small merchant refiners to the “brink of bankruptcy.” Lipinski said in a statement RINs, which refiners must buy to comply with the RFS, negatively impacted his company’s second quarter results. CVR’s profits fell 66% year-over-year in the second quarter.
Lipinski said blenders who are exempt from the RFS are earning “windfall profits” from selling RINs to refiners who cannot blend.
“RINs have become a black pool allowing exempt parties, and even speculators, to drive prices to confiscatory levels,” Lipinski said. “RINs were intended to be a compliance tool for refiners, not a device to extract windfall profits from obligated parties.”
RIN costs have created a drag on earnings for other refiners as well. Valero said biofuel blending obligations cost it $173 million in the second quarter, most of which went to RINs.
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