ELR Citation: 53 ELR 20018
No(s). 22-60266 (5th Cir. Jan 27, 2023)

The Fifth Circuit granted small refiners' motion to stay certain compliance obligations under the CAA pending appeal of EPA's decision denying their requested hardship exemptions from the Act's Renewable Fuel Standard obligations. The refiners argued EPA's late 2021 interpretation of CAA provisions regarding "disproportionate economic hardship" for exemptions led to an unlawful retroactive application of a new standard, and that denial of their petitions was arbitrary and capricious. The court found that EPA, by basing its denial on its new interpretation, disregarded the refiners' reliance interests, failed to give fair notice, and acted retroactively, which was "likely contrary to law." It granted the motion to stay, noting that the refiners were not guaranteed hardship waivers but were entitled to know the rules by which EPA will grant or deny their petitions in advance of making their applications.