Howls of Execration for EPA Ethanol Rules

(CN) - No one seems happy with the EPA's newly proposed standards for ethanol and biofuels to be blended into gasoline in the next two years, which fall well below congressional targets.

The EPA's proposed Renewable Fuel Standards , published Wednesday in the Federal Register, fall far short of standards Congress set in 2007.

The chairman of the Senate committee on the environment blasted the EPA for failing to meet Clean Air Act standards and deadlines year after year.

The corn industry called the standards a "gift to Big Oil, which has continuously sought to undermine the development of clean, renewable fuels."

The head of the Advanced Ethanol Council criticized the EPA for lacking the "backbone" to stand up to the oil industry's refusal to meet clean air standards.

And the American Petroleum Institute said the EPA standard of 10 percent ethanol is too high, and puts "American consumers, their vehicles and our economy at risk."

The standards are to apply to all gasoline- and diesel-powered motor vehicles produced or imported in 2014, 2015 and 2016.

The EPA acknowledges that the nation will not meet congressional targets for the next three years, due in part to "constraints in renewable fuel distribution infrastructure."

Targets Congress set in the Clean Air Act were meant to be ambitious, the EPA said, but it hopes its proposed standards will "lead to substantial growth over time in the production and use of higher-level ethanol blends and other qualifying renewable fuels."

Ethanol standards have been criticized as a sop to corn farmers, and many environmentalists claim they do not address energy or clean air issues at all, as studies have shown that more energy is used growing the corn than the corn produces through ethanol.

The EPA said it is using tools provided by Congress to waive the annual volumes required by law, but that it is steadily increasing volumes so that biofuels remain an important part of the national quest for energy security and climate issues.

The proposed 2016 standard for total renewable fuel is nearly 1.5 billion gallons more - 9 percent higher - than the actual 2014 volumes, and the 2016 standard for advanced biofuel is 27 percent higher than for 2014.

Janet McCabe, acting assistant administrator for EPA's Office of Air, called it "an important step forward in making sure the Renewable Fuel Standard program delivers on the congressional intent to increase biofuel use, lower greenhouse gas emissions and improve energy security. We believe these proposed volume requirements will provide a strong incentive for continued investment and growth in biofuels."

But many groups reacted by calling for a complete overhaul of the Renewable Fuel Standard mandate.

Sen. Jim Inhofe, chairman of the Environment and Public Works Committee, said the EPA announcement "adds to the building evidence of how poorly the agency has managed the renewable fuel standard, and how the mandate is in need of significant reform and oversight. Clearly, the statutory volumes are unachievable."

Inhofe said the EPA has waived annual required volumes and missed implementation deadlines every year since the Renewable Fuel Standard was expanded.

"All of these actions by EPA give a clear case for a mismanaged program in need of rigorous oversight," Inhofe said.

Advanced Ethanol Council Executive Director Brooke Coleman said that though the EPA's proposed targets are stronger and theoretically create new markets, they still encourage oil companies to block renewable fuels.

"Clean Air Act regulations have to have backbone to actually achieve their ambitions, and EPA is still allowing the oil industry's refusal to comply with the RFS to be cause to slow the program down. If the Obama administration continues to reward non-compliance with clean energy laws, clean energy laws will cease to be effective," Coleman said.

The corn industry was not pleased.

Chip Bowling, president of the National Corn Growers Association, said that setting the standard below the congressionally established benchmark "snubs consumers and farmers."

The "only beneficiary of the decision is Big Oil, which has continuously sought to undermine the development of clean, renewable fuels. Unfortunately, the EPA's gift to Big Oil comes at the expense of family farmers, American consumers and the air we breathe," Bowling said.

But the oil industry said the nation's fuel system has maxed out the amount of ethanol it can handle, at 10 percent.

American Petroleum Institute President and CEO Jack Gerard said the EPA should set the final ethanol mandate to no more than 9.7 percent of gasoline demand.

"Consumers' interest should come ahead of ethanol interests," he said. "EPA assumes growing demand for high-ethanol fuel blends that are not compatible with most cars on the road today, potentially putting American consumers, their vehicles and our economy at risk."

Gerard said the most confusing aspect of the EPA announcement was the push for more corn ethanol at the same time the agency pursues a climate agenda to reduce greenhouse gas emissions.

"The Environmental Working Group released a report showing EPA could lower U.S. greenhouse gas emissions by millions of metric tons each year if they reduce or eliminate the corn ethanol mandate," Gerard said.

He said the EPA announcement "makes abundantly clear that the only solution is for Congress to repeal or significantly reform the Renewable Fuel Standard. Members on both sides of the aisle agree this program is a failure, and we are stepping up our call for Congress to act."

The EPA will accept comments on the proposed volume requirements through July 27.

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