Ag Policy Blog

Dem Senators ask President to Leave RFS Alone

Todd Neeley
By  Todd Neeley , DTN Staff Reporter
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A pair of Democratic senators concerned that cutting the mandated production of biofuels in the Renewable Fuel Standard would lead to increased carbon pollution, have asked President Barack Obama to leave the 2014 RFS volumes in place. Their concerns are based on a recent analysis that said cutting biofuels production would lead to increased carbon emissions from gasoline.

In a letter to the president Wednesday Sens. Barbara Boxer, D-Calif., and Edward J. Markey, D-Mass., said the administration's proposal to cut the RFS would have far-reaching consequences on the climate change front.

"The RFS is a critical piece of our nation's climate mitigation policies," the letter said. "It is helping to break the oil sector's monopoly over our nation's liquid fuel supply by opening the market to competition from America's growing renewable fuel industry, bringing low carbon cellulosic, advanced biofuels and biomass-based diesel to market. Just this month, two new cellulosic biorefineries came online producing the lowest carbon motor fuel in the world.

"Rather than fostering competition and innovation in the transportation fuel market, the rule would give power to the oil industry to impede the development of its competition. Should this proposal be adopted, our consumption of oil would rise, yielding an immediate increase in carbon pollution in 2014 and beyond."

In an updated analysis by the Biotechnology Industry Organization, cutting the RFS could lead to increased greenhouse gas emissions of 21 million metric tons. "The increased GHG emissions are equal to putting an additional 4.4 million cars on the road or opening 5.5 new coal-fired power plants," the BIO report said.

"Recent Energy Information Administration estimates indicate that U.S. transportation fuel demand in 2014 did in fact increase and is already 2.5 billion gallons higher than projected in November 2013, when EPA's proposal was issued. Because biofuel use is expected to increase only slightly in 2014 compared to 2013, the United States has missed the opportunity to achieve GHG emission reductions in 2014 through consistent RFS regulatory policy."

The updated BIO study said gasoline demand has improved since the group's March analysis -- meaning there still is room under the so-called blend wall to continue on with the RFS as written.

"In its RFS rule for 2013, EPA concluded that the refining industry would not encounter the blend wall until 2014 and enforced the statutory RFS volumes for advanced and conventional biofuels, even while waiving the cellulosic requirement," BIO said. "EPA subsequently proposed a reduction of the RFS for 2014 in consideration of the blend wall. It is now clear that gasoline demand was higher in 2013 and 2014 than EPA projected when it issued both the 2013 rule and the 2014 proposal. The United States is no closer to the so-called blend wall in 2014 than it was in 2013. In 2014, EPA could have maintained the RFS methodology it used in 2013 and previous years."

In their letter to the president, Boxer and Markey said they have concern that changes in the RFS will hurt an emerging cellulosic ethanol industry.

"More importantly, this country's leading innovators in the advanced and cellulosic biofuels sector have expressed their concerns -- including in a September letter to you -- that EPA's new methodology increases supply chain and policy risk for investors so much that it will drive the further development of this low carbon industry to South America and Asia," the letter said. "EPA's proposed rule would not only increase carbon pollution, but would also derail our efforts to attract investment to critical U.S. innovation markets and drive the development of fuels that further reduce carbon pollution in the long-term."

FUELS AMERICA CAMPAIGN

The Fuels America coalition this week launched a digital advertising campaign "to highlight the $1.1 billion that big oil has spent to rig the political system with lobbyists and campaign cash since 2008, according to the latest data from opensecrets.org," the group said in a news release Thursday.

The ads are running on news websites during the next week, including on POLITICO.com, RollCall.com and TheHill.com. Fuels America said the oil industry recorded some $93 billion in profits in 2013. The groups said renewable fuels generate some $14.5 billion in tax revenue annually. "Meanwhile, the oil lobby has continued to fight to kill the Renewable Fuel Standard, which would permanently outsource thousands of American jobs and increase our reliance on foreign oil from hostile and unstable regions," FA said in a news release.

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melvin meister
10/9/2014 | 3:10 PM CDT
Thanks to the Senators .There is no blend wall just oil companies stopping ethanol every way possible.Where are the Blender Pumps .We need a choice at the pump.