The Fed’s $50 Billion Ethanol Mandate Is Actually HARMING the Environment


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Michael Bastasch DCNF Managing Editor
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For years, ethanol has been sold to the public as the environmentally-friendly alternative to gasoline, but researchers Dr. Daniel De La Torre Ugarte and Dr. Burton English found this is not the case.

Their study argues that ethanol policies are harming the environment and costing taxpayers billions of dollars. Not only is ethanol failing to curb U.S. carbon dioxide emissions, increased production is also harming air quality, according to researchers.

“Corn ethanol’s environmental record has failed to meet expectations across a number of metrics that include air pollutants, water contamination, and soil erosion,” according to the study, which was funded by a group critical of the ethanol mandate, the American Council for Capital Formation.

“Besides [greenhouse gases], other major pollutants associated with corn ethanol production and use include volatile organic compounds (VOCs), nitrogen oxides (NOx), particulate matter (PM), sulfur dioxide (SOx), and ammonia (NH3),” write La Torre Ugarte and English, researchers for University of Tennessee’s Institute for Agriculture. The authors concluded, “corn ethanol increases emissions of these pollutants relative to gasoline.”

In 2007, Congress passed a law requiring the EPA to increase the required ethanol refiners blend into the country’s gasoline supply, called the Renewable Fuel Standard. The RFS, combined with subsidies, caused ethanol production to spike from 3.9 billion gallons in 2005 to 14.3 billion gallons in 2014.

RFS supporters argued ethanol would be better for the environment and would decrease the country’s reliance on foreign oil. Things started off alright, but years later, it became apparent to a wide range of industries the RFS was bad for business and not yielding its promised eco-benefits.

The Associated Press published a scathing report on the environmental costs of corn ethanol production in 2013 — a report that shocked the industry. Even environmentalists are now against the RFS in its current form, joining together with refiners, anti-poverty groups and others in opposing the mandate.

Despite the heavy opposition, the Obama administration is still requiring refiners to blend 13.4 billion gallons of corn ethanol into gasoline this year and 14 billion gallons next year.

“There are few things worse for the environment than gasoline, but corn ethanol is one of them,” Emily Cassidy, a research analyst with the Environmental Working Group, said of the decision in May. “The administration’s decision to blend more corn ethanol into gasoline will mean more greenhouse gas emissions at a time when we drastically need to curb them to slow climate change.”

But it’s not just environmental costs critics worry about. They argue the RFS is costing taxpayers while also raising food and fuel prices.

Indeed, the UT study found “while there are some localized economic benefits to corn ethanol refineries, there also have been widespread economic costs.” Researchers argue ethanol has gotten $50 billion in taxpayers and market subsidies since 2005.

The ethanol lobby, however, maintains the RFS is good for the environment and the country. Corn growers held a press call earlier this month where they called for the EPA to strengthen the RFS.

“Already, the new industry has suffered a $13.7 billion shortfall in investment because of uncertainty around the RFS,” Roger Johnson, President of the National Farmers Union, said on the call.

“That cuts off a long-term potential for supplemental farm income, and causes job loss in rural communities,” he said. “The economic and environmental benefits of advanced biofuels cannot be realized without a strong RFS.”

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