Ag Policy Blog

Agricultural and biofuel groups were quiet after EPA Administrator Lee Zeldin on Tuesday announced EPA would revoke its "endangerment finding" on greenhouse gas emissions.

Should agriculture welcome this move? It would permanently take away the risk of the dreaded "cow tax" – a fear that has lurked within the livestock industry since the very first decisions that EPA is obligated to regulate greenhouse gases.

But what does it mean for biofuels if EPA says it no longer had the authority to regulate emissions from liquid fuels?

The 2009 endangerment finding concluded that increasing concentration of six greenhouse gases, driven mainly from fossil-fuel use, endanger public health and public welfare. The endangerment finding gives EPA the authority and the obligation to regulate greenhouse gases from fuels, vehicles, and other sources.

Without the endangerment finding, EPA is positioning itself as having neither the authority nor the willingness under the Clean Air Act to regulate greenhouse gas emissions from fossil fuels.

"If finalized, today's announcement would amount to the largest deregulatory action in the history of the United States," Zeldin said Tuesday.

The endangerment finding came in 2009 after the Supreme Court had ruled two years earlier in Massachusetts v. EPA that the agency could regulate carbon and methane emissions under the Clean Air Act. At that time, the High Court ruled EPA could not decline to exercise its statutory authority to regulate greenhouse gases by invoking "a laundry list" of policy concerns, a recent Congressional Research Service report noted.

If that finding is revoked, EPA would no longer be legally required to consider GHG emissions reductions in transportation fuels.

The move should raise questions about the impact on biofuel production and growth going forward.

If EPA declares there is no reason to regulate greenhouse gas emissions, the implications for ethanol could be far-reaching, especially in terms of policy support, market demand, and public perception.

Eliminating the need to reduce greenhouse gases undermines one of ethanol's core justifications. The backbone of the Renewable Fuel Standard (RFS) is that it reduces greenhouse gas emissions relative to gasoline.

The RFS aims to lower life-cycle greenhouse gas emissions from fuels by blending lower-carbon ethanol and biodiesel into petroleum-based fuels. If EPA abandons greenhouse gas regulation, it opens the RFS and biofuel use to new rounds of legal and political attacks, especially from the oil industry.

Motor vehicle emissions are responsible for 23% of all U.S. greenhouse gas emissions. If the U.S. motor vehicle sector were a country, it would be the fourth-largest emitter of greenhouse gases in the world, according to EPA data, the New York Times noted.

Removing the endangerment finding would also likely lead to more litigation against industries by localities and states impacted by disasters or pollution. A patchwork of state laws could develop in blue states given that there would be no federal control.

There will be a lot at play going forward as EPA moves through its own rule-making process, the final rule comes about and the eventual litigation over EPA's recission.

Chris Clayton can be reached at Chris.Clayton@dtn.com

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