Alon Refining Krotz Springs Inc. and HF Sinclair affiliates had applied in May 2025 for exemptions from their 2024 renewable fuel obligations under the Clean Air Act's Renewable Fuel Standard program. The refineries met the 75,000-barrel daily throughput threshold for 2024 but exceeded it in 2023. The EPA denied their exemption applications in August 2025, saying its 2014 regulation requires qualifying refineries to stay under the throughput limit for two consecutive years.
Circuit Judge Pan, writing for the majority, said the EPA's interpretation contradicted the plain language of its own 2014 eligibility regulation. "Because the regulation's text is clear, we have 'no business deferring to any other reading, no matter how much [the EPA] insists' that its preferred reading 'would make more sense,'" Pan wrote, quoting the Supreme Court's decision in Kisor v. Wilkie. The court found that under the regulation's terms, both the "most recent full calendar year prior to seeking an extension" and "the year for which an exemption is sought" pointed to 2024 for the refineries' applications.
The refineries had sought expedited review to preserve the value of Renewable Identification Numbers (RINs) they purchased to comply with their 2024 obligations. These credits expire after being valid for only two years, and the compliance deadline for 2025 obligations is expected to be September 1, 2026. The court initially consolidated their cases with other small refinery exemption challenges before granting requests to sever and expedite the proceedings.
The decision gives the EPA 90 days to reconsider the applications on remand, which should provide sufficient time before the RIN expiration date. In a concurrence, Circuit Judge Rao went further, arguing that the EPA's denials also violated the Clean Air Act itself, which defines small refineries based on throughput "for a calendar year" rather than multiple years. The ruling could affect how EPA processes future small refinery exemption requests under the RFS program.