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NJ Daily

Ethanol Mandate’s Squeeze on Corn Starting to Worry Some Senate Democrats

Biofuels: Mandate bugs some in Congress.(AP Photo/Sue Ogrocki)

photo of Amy Harder
July 23, 2013

Senate Democrats from the Mid-Atlantic states are wading into a debate over a controversial biofuels standard that upends the conventional wisdom about their party’s steadfast support for a policy whose goal is to promote renewable-energy fuels over oil.

Sen. Ben Cardin, D-Md., is working on legislation to reform the renewable-fuels standard, while senators from neighboring states, including Delaware and Pennsylvania, may urge the Obama administration to temporarily waive sections of the law that require increasing amounts of biofuels—mainly corn-produced—to be blended with gasoline each year.

Since last summer’s historic drought that sent corn prices soaring, the eight-year-old renewable-fuels standard has come under attack for adding to the pressure on corn supplies. Mid-Atlantic lawmakers, in particular, are hearing from the poultry industry, which is concerned about rising feedstock prices, and from oil refineries, which are facing increased costs for blending ethanol with gasoline.

 

“I am reviewing a number of different proposals, both legislative and in letter form, that would seek some temporary modification of the renewable-fuel standard,” Sen. Christopher Coons, D-Del., told National Journal Daily on Tuesday. “I’m very aware of the significant negative impact on both the poultry industry in my home state because of the price pressure on corn and the refinery in my state because of the dramatic spike in [renewable-fuel] prices.”

Congress created the RFS in 2005 and strengthened it in 2007 to help reduce U.S. oil consumption and increase the use of renewable fuel sources. Virtually all Democrats support advanced biofuels made from other products besides corn, but those haven’t been developed as quickly as Congress initially envisioned. Coons, like some of his Democratic colleagues in the region, said he would not support a full repeal of the policy, as livestock producers and the oil industry are urging.

“It’s important for us to continue the market pull toward an advanced biofuels industry,” he said, referring to biofuels such as cellulosic ethanol that don’t come from food crops. “I am not going to support repeal.”

Cardin’s yet-to-be-introduced bill reportedly focuses on the feedstock side of the issue. He is being lobbied by poultry producers who say the biofuels mandate is raising the cost of their feed.

“We’re in the early stages on the Senate side,” said Jack Gerard, president of the American Petroleum Institute, who mentioned Cardin’s bill and another proposal introduced by Sens. Pat Toomey, R-Pa., Mark Pryor, D-Ark., and John Barrasso, R-Wyo., that would repeal the standard. “It’s in an intensifying state, to where more and more [senators] are going to get engaged I expect.”

Gerard was among several witnesses who testified Tuesday during the first day of a two-day hearing on the renewable-fuels standard before a House Energy and Commerce subcommittee. The hearing, which concludes Wednesday, is a reminder that the lower chamber is leading the debate on this contentious issue. The Senate has not yet held a hearing, and it’s unclear when or whether it will.

It’s also unclear when Cardin will introduce his bill or who will cosponsor it. It’s different than legislation he introduced last fall that would link the mandate’s corn-ethanol requirement with the size and availability of U.S. corn supplies.

“Reforming the RFS is pretty complicated. We’re getting closer,” said Sue Walitsky, spokeswoman for Cardin. “Senator Cardin wants to do this soon, but getting it right is most important.”

Toomey is planning to send a letter to the administration requesting some sort of relief from the mandate within the next few days. His fellow Pennsylvanian, Democratic Sen. Robert Casey, is reportedly considering signing a similar letter, according to an oil lobbyist. Casey said Tuesday that while he hasn’t focused on the issue lately, he intends to. “I think we have some work to do on it,” Casey said.

Other Democratic senators who reportedly may sign a letter include Kay Hagan of North Carolina, Thomas Carper of Delaware, and Chuck Schumer of New York.

This article appears in the July 24, 2013 edition of NJ Daily as Dems Fret Over Ethanol Mandate’s Squeeze on Corn.

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