Biofuel makers were relieved to hear the Environmental Protection Agency was delaying finalizing its 2014 ethanol mandate until next year — a decision which has sparked legal action from fuel refiners.
The EPA announced Friday its 2014 biofuel blending requirements would be “significantly delayed” until 2015. The move was welcomed by the biofuels industry which is worried about the EPA reducing the amount of ethanol that must be blended into the fuel supply. But EPA’s action was protested by fuel refiners, who have filed suit to force the agency to issue new blending requirements.
“EPA’s failure to comply with [Renewable Fuel Standard] deadlines has caused additional harm to obligated parties,” said Charles Drevna, president of the American Petrochemical & Fuel Manufacturers. “We urge EPA to take prompt action to promulgate the 2014 standards.“
The federal Renewable Fuel Standard (RFS) requires the EPA to set biofuel blending requirements for refiners by November 30 of the previous year. The EPA, however, says it won’t be able to set any requirements for 2014 until next year, which violates the Clean Air Act according to AFPM.
The RFS, which was signed into law by President George W. Bush, requires ever-increasing amounts of ethanol to be blended into the fuel supply as a way to fight global warming and reduce America’s reliance on foreign oil.
But economics have gotten in the way of this grand design to stem warming and become energy independent through biofuels. Low gasoline demand and production have made it so refiners are bumping up against the dreaded “blend wall” — the point at which more ethanol can’t be safely blended into the fuel supply.
Refiners have been sounding the alarm on the “blend wall” for the last couple of years — the coming of which was signaled by skyrocketing renewable fuel credit prices. The EPA has taken some action to relieve refiners, but the industry argues that the law needs to be repealed or drastically reformed.
“The fact that EPA proposed the 2014 standards over a year ago, and now 2014 is almost over, is another reason why Congress needs to step in and repeal or significantly reform this badly broken program,” Drevna argued.
The major obstacle standing in the way of reform is the biofuels industry, which has been largely propped up by the federal ethanol mandate. Biofuel makers say reducing ethanol blending requirements will kill jobs and hurt farmers who produce corn that is made into ethanol.
Biofuel makers also argue that ethanol gives consumers an alternative to conventional gasoline and breaks the hold “Big Oil” has over consumers.
“Pulling back on the 2014 RFS rule is the right thing to do at this stage in the game when it comes to preserving the integrity of the program,” said Brooke Coleman, executive director of the Advanced Ethanol Council.
“While the cellulosic biofuel industry will not get the policy certainty it needs from this decision, it does suggest that the Administration is listening when it comes to our concerns about giving oil companies too much power to avoid its obligations under the RFS going forward,” Coleman said.
But refiners aren’t the only ones complaining about the RFS — environmentalists, anti-hunger groups, livestock farmers, chain restaurants and others are also arguing the policy needs to be repealed or reformed.
Environmentalists worry that biofuels are causing more or just as much harm to the environment than conventional oil does. A federal government-backed study from earlier this year found that ethanol releases more greenhouse gases in the short-term than conventional oil.
Before that, the Associated Press released a report detailing how much conservation land has been put into use to grow more corn in order to satisfy the federal ethanol mandate. The AP reported that more than 1.2 million acres of “virgin land” in Nebraska and the Dakotas have been plowed into corn and soybean fields since 2006. The AP also noted that more corn production means more toxic nitrogen fertilizer use, which can seep into drinking water and spark algae blooms.
“By failing to reduce the amount of corn ethanol blended into gasoline, the Obama administration today missed an opportunity to immediately reduce greenhouse gas emissions,” said Mike Lavender, a policy analyst with the Environmental Working Group. “If we hope to reverse climate change, we need greenhouse gas reductions now, not in 2025, and reducing the amount of corn ethanol in gasoline is among the most effective tools at the administration’s disposal.”
Anti-hunger groups argue that the RFS has caused the global price of corn to skyrocket, which has exacerbated hunger in poor countries. It’s also caused prices for poultry, pork and other livestock to rise as well.
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