Lawyers for EPA and POET Biorefining squared off in court Monday over whether the agency’s guidance for measuring production of cellulosic ethanol is tantamount to a rule containing requirements that are impossible to meet.

One of the major issues is whether there exists any type of “representative reference material” companies can use to determine the amount of converted cellulose. POET attorney Seth Waxman, solicitor general under President Bill Clinton, said no such RRM is available, synthetic or otherwise.

“Everyone agrees, naturally occurring or synthetic, there is no reference material,” and thus “it is … arbitrary and capricious and unreasonable to impose a requirement that is impossible to satisfy,” Waxman said.

In a 2014 rule, EPA “allowed producers of cellulosic ethanol to use any measurement method that was approved either by a private standards-setting body or by peer reviewers,” POET said in a brief filed in the case.

But a guidance document issued last year shifted course by requiring the use of a RRM and sidelining outside experts, Waxman said.

Waxman said the guidance issued by EPA imposes requirements like a rule does, making it subject to court review.

The guidance is “mandatory” and was used to deny a registration application by POET’s Hudson, S.D., facility after the guidance was issued last year, Waxman said.

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Justice Department attorney Paul Salamanca, however, argued that “the guidance is not final” and does not bind EPA or determine any rights or obligations.

“Even if the guidance were final, it is simply an interpretive rule and, as such, is not subject to notice and comment,” Salamanca said. He also disputed whether EPA had made a final decision on the Hudson facility.

“At this point, there’s no conclusive evidence that cellulose in fact is being turned into ethanol, and that is why EPA is engaging producers such as [POET] to undertake” strategies to determine accurately the amount of ethanol produced from corn kernel and fiber.

Salamanca also pushed back on POET’s argument regarding representative reference materials, saying that “scientists make representative reference materials all the time.”

Arguments were held virtually before Circuit Judges Karen Henderson, Merrick Garland and Nina Pillard of the D.C. Circuit Court of Appeals.

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