The Environmental Protection Agency (EPA) announced its final targets for using renewable fuels in the next two years under what’s called the federal Renewable Fuel Standard (RFS). The final numbers released today for biodiesel and ethanol are below the original numbers called for in the law.
The ethanol numbers especially do not please Iowa Renewable Fuels Association executive director Monte Shaw. “The statute was very clear that in ’15 and ’16 the number was supposed to be 15 billion gallons. And they did not have in our view a legal justification for reducing those numbers under the law,” Shaw says. “They came up with a very convoluted — in my opinion — reasoning on why they had that justification.”
The EPA is calling for use of just more than 14 billion gallons of ethanol for 2015 and 14.5 billion gallons for 2016. Shaw says the EPA used the mythical “blend wall” or maximum amount of ethanol that can be used in the place of gasoline to justify its lowering of the RFS levels.
“They unfortunately adopted the oil company’s way of thinking in that. And really when you do that, what you ‘ve done is you’ve taken the whole purpose of the RFS and you’ve turned it upside down,” Shaw says. “The purpose for the RFS was to get these renewable fuels in front of consumers so the consumers could make choices. And what the EPA essentially said today is: ‘well oil companies aren’t letting consumers have access to these fuels, so we can’t raise the number’.”
Shaw says the ruling goes against everything that was intended in setting the levels for renewable fuels. “You know, this was supposed to be for free markets and consumer choice. Instead we are left with a near monopoly on our gasoline supply by the oil industry. Very, very disappointing,” according to Shaw.
He expects everyone in the renewable fuels industry to read the final ruling and then to take action. “I think there’s a strong likelihood that you will see legal action to try to reign in EPA and how they ignored the statute, and even legislative intent,” Shaw says.
Shaw says if it goes to court it will be a one to two year process “and in the mean time this is what we have to live with.” Iowa is the nation’s leader in renewable fuels production. Iowa has 43 ethanol refineries capable of producing three-point-nine billion gallons of ethanol annually. Iowa also has 12 biodiesel facilities with the capacity to produce nearly 315 million gallons annually.
Members of Iowa’s Congressional delegation have pushed the EPA to now lower the amount of renewable fuels that will be requires.
Congressman Dave Loebsack released the following statement today after the Environmental Protection Agency released its final rule:
“The RFS has proven it works. It creates jobs, supports our agricultural communities and lessens our dependence on foreign oil. I have been leading the bipartisan fight in Congress for a strong RFS, and while the numbers are greater than the original proposal, they do not go far enough. I will continue to work with the EPA to ensure the RFS remains good for Iowa.”
U.S. Senator Chuck Grassley made the following comment on the final rule:
“This rule is a slight improvement but it still sells biofuels short. The EPA just doesn’t appreciate that farmers and biofuels producers can generate enough renewable fuels to meet the goals set by Congress. The EPA doesn’t seem to appreciate that the law on the books requires strong biofuels targets and that consumers like the chance to use alternate fuels. Instead, the EPA took a flawed approach that seems to buy into Big Oil’s rhetoric. The new rule is not only more than two years late, but it also sets back the development of next generation biofuels. This rule undermines the efforts to commercialize the next generation of biofuels. It’s unfortunate that this Administration, which claims to be for renewable and clean energy, would stand in the way of the production and use of more renewable fuels.”
U.S. Senator Joni Ernst released this statement:
“I am extremely disappointed by the EPA’s choice to reduce volume requirements for corn ethanol which flies in the face of original congressional intent, and fails to provide any incentives for expanding alternative fuel availability for consumers. The Obama Administration is once again using the EPA to impose their agenda on hardworking Iowans by instituting biofuel volume requirements that are lower than originally mandated and in direct contradiction of the law.
“The RFS creates consumer choice for clean fuel, spurs investment in research, production and infrastructure. Furthermore, it is critical to growing our green energy sector, reducing our dependence on foreign oil, and supporting the rural economy in Iowa and across the Midwest.
“Iowa is a national leader and is home to retailers across the state who offer affordable ethanol and biodiesel blends to consumers which is in direct alignment with the original intent of RFS when Congress passed it.
“Having a strong and long-term RFS is of critical importance to Iowa, as well as our nation. I remain committed to protecting our domestic energy security and promoting innovation in the next generation of biofuels which are paramount to the health and vitality of our state as we chart a path forward.”
Iowa Governor Terry Branstad released this statement on the EPA’s decision:
“I am extremely disappointed that the EPA’s final decision failed to follow the renewable volume levels set by Congress,” said Branstad. “Unfortunately, today’s decision shows the lack of interest in providing consumers choice at the pump, creating jobs and increasing incomes in Rural America, and reducing our dependence on foreign oil. This rule falls far too short of a robust RFS and short of the standards set by Congress.”
“This entire process has negatively impacted Iowa families through reduced commodity prices, farm incomes, and farmland values,” said Reynolds. “We were hopeful that the EPA would fully recognize the importance of renewable fuels after years of regulatory uncertainty. However, the EPA’s decision only marginally improves volume levels in a step that will hurt Iowa families, businesses, and farmers.”