A significant agreement was reached yesterday with the Justice Department, the Environmental Protection Agency (EPA), and Colonial Oil Industries Inc. Colonial Oil will pay a large civil penalty totaling more than $2.8 million as part of this settlement. Furthermore, the company has committed to investing approximately $12.2 million in initiatives aimed at mitigating the negative effects on both human health and the environment caused by its purported noncompliance with the Clean Air Act’s Renewable Fuel Standard (RFS) program and gasoline volatility regulations. This resolution highlights a collaborative effort to enforce environmental standards and protect public health.
From 2013 to 2019, Colonial Oil deliberately excluded specified fuel provided to maritime boats from its calculations for renewable volume commitments, violating the Renewable Fuel Standard (RFS) standards. According to these laws, gasoline intended specifically for use in ocean-going vessels is exempt from renewable volume obligation calculations. However, it is important to note that not all marine vessels fall into the category of ocean-going vessels; thus, the quantities provided to other types of marine vessels must be considered in these calculations.
By removing these quantities, Colonial Oil’s actions resulted in a decrease in the use of renewable fuels in place of conventional petrol and diesel fuel, increasing greenhouse gas emissions. This deliberate omission not only breached legal criteria but also had significant environmental consequences, contributing to an increase in greenhouse gas emissions throughout the designated period.
What is the Clean Air Act?
The Clean Air Act is a comprehensive federal law passed in the United States with the primary goal of controlling air pollution. It was first enacted in 1963 and has since undergone various revisions and extensions. The Clean Air Act authorizes the Environmental Protection Agency (EPA) to develop and implement laws to protect human health and the environment by managing and reducing air pollution.
The Clean Air Act establishes national air quality guidelines for common pollutants such as ozone, particulate matter, carbon monoxide, sulfur dioxide, nitrogen oxides, and lead. These requirements are intended to protect public health and welfare, including vulnerable groups such as children, the elderly, and people with respiratory diseases.
Furthermore, the Clean Air Act requires the creation and implementation of programs to combat specific sources of air pollution, such as emissions from automobiles, industrial sites, power plants, and other sources. It includes rules for reducing hazardous air pollutant emissions, encouraging the use of cleaner fuels and technologies, and defining emission criteria for new and existing sources of pollution.
The Clean Air Act also fosters collaboration among federal, state, tribal, and municipal governments, as well as industry and the general public, to achieve its objectives of improving air quality and preserving human health and the environment. Enforcement mechanisms such as penalties, fines, and other regulatory measures are used to guarantee that the law’s requirements are met.
Upholding Renewable Fuel Standards: Legal Perspectives and Environmental Imperatives
“The development and utilization of renewable fuels constitutes a pivotal strategy in mitigating the cumulative impact of greenhouse gas emissions,” stated Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division. “Through this proposed settlement, Colonial will be held accountable to the same renewable fuel standards as all importers and producers, ensuring equitable adherence to regulatory obligations.”
Assistant Administrator David M. Uhlmann of the EPA’s Office of Enforcement and Compliance Assurance emphasized that “renewable fuels serve as a cornerstone in diversifying the nation’s energy portfolio and reducing greenhouse gas emissions.” At the same time, they promote economic growth and job creation in communities around the country. Uhlmann stated, “This settlement underscores the need for petrol and diesel refiners and importers to discharge their duties in lowering pollution that harms both the environment and public health. Noncompliance will result in actual consequences, demonstrating a persistent commitment to regulatory enforcement.”
Enforcing Renewable Fuel Compliance: Colonial Oil’s Obligations and Environmental Impact
Under the Clean Air Act’s Renewable Fuel Standard (RFS) program, petrol and diesel fuel refiners and importers must mix renewable fuels into their transportation fuel blends or obtain Renewable Identification Numbers (RINs) to meet their renewable volume responsibilities. However, between 2013 and 2019, Colonial Oil failed to procure and retire an adequate number of RINs as required by the regulations.
As part of the settlement, Colonial Oil is required to acquire and retire over 9 million RINs within two years, costing an estimated $12.2 million. This collaborative effort is expected to have a considerable environmental impact, with estimations showing a reduction of nearly 18,300 metric tonnes of carbon dioxide equivalent emissions. To put this reduction into context, it is equivalent to giving energy to 2,386 homes for a year or fueling 4,355 gasoline-powered cars at the same time. Colonial hopes that by taking these steps, it will be able to make amends for previous noncompliance and positively contribute to environmental conservation efforts.
Conclusion
In addition to the aforementioned infractions, Colonial Oil failed to comply with Clean Air Act regulations by selling more than a million gallons of gasoline that did not match the specified volatility threshold. This standard is primarily designed to reduce evaporative emissions during the summer months, decreasing gasoline’s contribution to smog formation and alleviating the negative health effects of ozone pollution, such as asthma, emphysema, and chronic bronchitis. Attorneys from the Justice Department’s Environmental Enforcement Section are overseeing the case and working hard to resolve the infractions.
The proposed settlement, which is awaiting final approval from the United States District Court for the Southern District of Georgia, is currently subject to a 30-day public comment period. This approach demonstrates the commitment to transparency and responsibility when resolving environmental compliance issues through legal channels.
This enforcement action marks a significant milestone as it represents the inaugural instance involving the interpretation and application of the definition of an “ocean-going vessel” within the Renewable Fuel Standard (RFS) regulations under the Clean Air Act. Essentially, this case is the first of its kind to address and clarify the parameters and criteria for categorizing vessels as “ocean-going” under these specific regulations of the Clean Air Act. The outcome of this case could potentially establish a precedent and provide clarity for future enforcement actions and compliance efforts within the maritime industry concerning renewable fuel standards.
