Cross-posted at WLF’s contributor page

We aren’t convinced Congress meant for the EPA to  . . . let the wish be the father of the thought“.

With that wonderful turn of a phrase, Senior Judge Stephen Williams began another U.S. Court of Appeals for the D.C. Circuit opinion reminding the Environmental Protection Agency that Congress and its statutes place firm limits on EPA’s discretion and actions.

American Petroleum Institute v. EPA, released last Friday, arose from a “renewable fuel standard” (RFS) program under the Clean Air Act.We’ve commented on this program previously here at The Legal Pulse. Under the mandate, refiners would have to use an increasing amount of biofuels or face fines. Congress’ overarching purpose was to reduce greenhouse gas emissions, and broadly encourage biofuel technology. It singled out “cellulosic biofuel,” which, in 2007 when Congress adopted the program, was barely available on a commercial basis. Congress, the court noted in APA v. EPA, “assumed significant innovation,” but in the event that innovation didn’t occur, lawmakers tasked EPA with the job of projecting what would be available and adjusting the percentage requirement down based on that projection.

Congress, it seems, was far too optimistic about cellulosic fuel. EPA’s estimate for 2011 was around 9 million gallons, 491 million gallons short of Congress’s RFS mandate. API argued that EPA overestimated the available cellulosic fuel; the actual amount was zero. Despite the obvious shortfall in cellulosic fuel, EPA refused to reduce the total volume of biofuels required. API sued under the Administrative Procedures Act to have EPA’s determination vacated.