Biofuels Producers Blame Big Oil for EPA Plan to Cut Renewable-Fuel Standard

Biofuel makers aren't happy about scalebacks to renewable fuel levels, and they want you to know the oil industry is to blame.
National Journal
Clare Foran and Alex Brown
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Clare Foran and Alex Brown
Nov. 15, 2013, 10:49 a.m.

Bio­fuels makers and corn pro­du­cers are not happy about the En­vir­on­ment­al Pro­tec­tion Agency scal­ing back on re­new­able-fuel levels for next year, and they’re united about who’s to blame: the oil in­dustry.

“EPA’s pro­pos­al fun­da­ment­ally be­trays this ad­min­is­tra­tion’s com­mit­ment to clean re­new­able fuels and caves to big-oil de­mands,” said Bri­an Jen­nings of the Amer­ic­an Co­ali­tion for Eth­an­ol. Ad­ded Re­new­able Fuels As­so­ci­ation Pres­id­ent Bob Din­neen: “Last time I checked, the oil com­pan­ies were do­ing pretty good on their own.”

Pet­ro­leum groups are part of a co­ali­tion that has pushed for a re­duc­tion in the fed­er­al man­date for re­new­able-fuel pro­duc­tion, ar­guing gas­ol­ine blends with high­er eth­an­ol con­tent could prove dam­aging to en­gines and drive up fuel costs. “For the first time, EPA has ac­know­ledged that the blend wall is a dan­ger­ous real­ity and must be ad­dressed to avoid ser­i­ous im­pacts on Amer­ica’s fuel sup­ply and harm to Amer­ic­an con­sumers,” said Jack Ger­ard, pres­id­ent of the Amer­ic­an Pet­ro­leum In­sti­tute. “[But] while the EPA took a step in the right dir­ec­tion, more must be done to as­sure Amer­ic­ans have the choice of fuel they want and we’re con­tinu­ing or call for Con­gress to act now.”

EPA an­nounced Fri­day that it is pro­pos­ing to lower the stat­utory re­quire­ment for bio­fuels pro­duc­tion in 2014 from 18.15 bil­lion gal­lons to a re­com­men­ded tar­get of 15.21 bil­lion gal­lons. The agency also pro­poses a range of 2 bil­lion to 2.51 bil­lion gal­lons of ad­vanced bio­fuels with a re­com­men­ded tar­get of 2.2 bil­lion gal­lons. The range falls be­low the pro­posed tar­get of 3.75 bil­lion gal­lons un­der the En­ergy Se­cur­ity and In­de­pend­ence Act of 2007.

Re­ac­tions to the pro­pos­al were un­an­im­ously neg­at­ive from the bio­fuels in­dustry, while oil re­finers, food mar­keters, and even re­cre­ation­al groups were de­lighted. Crit­ics of the re­new­able-fuels stand­ard, which was en­acted with the goal of re­du­cing U.S. de­pend­ence on for­eign oil, say it has in­creased both fuel and food prices by shift­ing vast amounts of corn in­to eth­an­ol pro­duc­tion.

“Study after study has shown that the corn-eth­an­ol man­date has ar­ti­fi­cially driv­en up com­mod­ity costs by bil­lions of dol­lars an­nu­ally, and with it, con­sumer prices,” said Rob Green, ex­ec­ut­ive dir­ect­or of the Na­tion­al Coun­cil of Chain Res­taur­ants. “Today’s pro­pos­al by the EPA re­af­firms our stead­fast be­lief that Con­gress needs to re­peal the RFS man­date once and for all.”

“While we are thank­ful and sup­port the ac­tion EPA is tak­ing today, its tim­id ad­just­ment re­con­firms the pro­gram is broken bey­ond re­pair,” said Na­tion­al Chick­en Coun­cil Pres­id­ent Mi­chael J. Brown.

“We ap­pre­ci­ate the clear step that EPA has taken to not only ac­know­ledge the un­at­tain­able man­dates in­cluded in the re­new­able-fuel stand­ard but to also leave room for con­sumers, man­u­fac­tur­ers, and in­dus­tries, in­clud­ing the re­cre­ation­al-boat­ing com­munity, that rely on the con­tin­ued avail­ab­il­ity of low-eth­an­ol fuel blends,” said the Na­tion­al Mar­ine Man­u­fac­tur­ers As­so­ci­ation’s John McK­night.

Among the oth­er neg­at­ive re­ac­tions were these:

  • “What we’re see­ing is the oil in­dustry tak­ing one last run at try­ing to con­vince ad­min­is­trat­ors of the RFS to re­lieve the leg­al ob­lig­a­tion on them to blend more bio­fuel based on clev­er ar­gu­ments meant to dis­guise the fact that oil com­pan­ies just don’t want to blend more bio­fuel.” — Brooke Cole­man of the Ad­vanced Eth­an­ol Coun­cil.
  • “[Fri­day’s] pro­pos­al re­veals that EPA might still de­liv­er a dev­ast­at­ing blow to this nas­cent sec­tor and a vic­tory for the oil in­dustry by cut­ting the volume re­quire­ments for ad­vanced bio­fuels.” — Ad­vanced Bio­fuels As­so­ci­ation Pres­id­ent Mi­chael McAdams.
  • “We can­not put oil’s in­terests be­fore the na­tion’s needs. Blend­ing more re­new­able fuel means more sav­ings for con­sumers at the pump.” — No­vozymes North Amer­ica Pres­id­ent Adam Mon­roe.

Mem­bers of Con­gress also weighed in on the EPA pro­pos­al. Most sig­ni­fic­antly, House En­ergy and Com­merce Chair­man Fred Up­ton, R-Mich., and rank­ing mem­ber Henry Wax­man, D-Cal­if., is­sued a joint state­ment gen­er­ally sup­port­ing the EPA pro­pos­al — though in dif­fer­ent tones — and in­dic­at­ing they are work­ing to­geth­er to ad­dress the grow­ing con­trovsery about the re­new­able-fuel stand­ard.

Oth­er re­ac­tions fell along re­gion­al lines. Rep. Bruce Bra­ley, D-Iowa, who is run­ning for Sen­ate in the middle of corn coun­try, said “growth in Iowa’s re­new­able-en­ergy in­dustry stands to suf­fer, put­ting job growth at risk” as a res­ult of the policy shift.

Rep. Peter Welch, D-Vt., an out­spoken RFS op­pon­ent, called the EPA an­nounce­ment “wel­come news” and a sign for Con­gress to change the policy.

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