Savannah's Colonial Oil faces $15 million hit for seven years of federal fuel violations
A company that has been a fixture at the Port of Savannah for more than a century faces a $2.8 million federal fine and more for violations related to fuel it supplied to vessels serving the facility.
Colonial Oil Industries Inc., a subsidiary of Savannah-based Colonial Group, failed to use a blend of “renewable” and traditional diesel when fueling non-ocean-going vessels from 2013 to 2019, according to a settlement between the company, the U.S. Department of Justice and the Environmental Protection Agency.
While the EPA’s renewable fuel standards make an exception for seafaring craft, “Our complaint alleges that Colonial violated the RFS regulations by excluding all fuel it supplied to marine vessels, not just ocean-going vessels,” explained DOJ spokesman Matthew Nies in an email Friday.
Renewable fuel, which can be mixed with traditional diesel, still pollutes when burned but has a smaller carbon footprint over its lifecycle because it is produced from raw materials such as used cooking oil and animal fat waste rather than refined from extracted oil.
“The creation and use of renewable fuels reduces overall greenhouse gas emissions,” Assistant Attorney General Todd Kim of the Justice Department’s Environment and Natural Resources Division said in the government’s announcement of the agreement. “This proposed settlement will hold Colonial to the same renewable fuel requirements that all importers and producers must adhere to.”
In addition to the fine, Colonial Oil will be required to “purchase and retire” $12.2 million in “credits” through the RFS program.
Under RFS rules, refiners or importers of gasoline or diesel are required to either blend renewable fuels into transportation fuel or buy credits known as Renewable Identification Numbers to meet federal requirements.
Fueling debate: Expansion of Savannah natural gas export facility at crux of nation's climate discussion
Between 2013 and 2019, Colonial failed to purchase and retire enough RINs to account for the traditional fuel supplied to non-ocean-going vessels.
“The RIN purchase and retirements is estimated to result in over 18,300 metric tons of carbon dioxide equivalent reductions which equates to powering 2,386 homes’ energy use or 4,355 gasoline cars for a year,” the federal agencies said in their announcement.
Carbon dioxide, a heat-trapping pollutant, is the primary contributor to climate change.
“This settlement once more puts gasoline and diesel refiners and importers on notice that they must meet their obligations to reduce climate- and health-harming pollution and that there will be consequences if they do not,” said Assistant Administrator David M. Uhlmann of the EPA’s Office of Enforcement and Compliance Assurance.
A company spokeswoman did not respond to a request for comment Friday.
Federal officials will finalize the decree after a 30-day public comment period.
The agreement comes a little more than a month after the company announced a partnership with Neste, the nation’s leading supplier of renewable diesel, that Colonial said marked “a significant stride towards a more sustainable future in the Southeast.”
In addition to Colonial Oil Industries, Colonial Group’s holdings include Enmarket, a chain of 130 fuel and convenience stores; Colonial Terminals; and the Savannah Yacht Center, among other companies.
Through its distribution services and pipeline network, Colonial Oil says it reaches customers in 34 states.
Comments on the consent decree can be submitted by visiting justice.gov/enrd/consent-decrees.
John Deem covers climate change and the environment on the Georgia coast. He can be reached at jdeem@gannett.com
This article originally appeared on Savannah Morning News: EPA, Department of Justice enter consent agreement with Colonial Oil
