In order to prevent Americans from hitting the blend wall, the EPA proposed lowering the 2014 mandate. With this proposal came major political pressure from ethanol makers and now the EPA is considering backing down.
For the first time since the ethanol mandate was enacted, a government agency has confirmed what the refining industry has said for years…forcing ethanol into our fuel supply will increase gas prices.
Oil refiners do oppose the ethanol mandate, but they are hardly the only ones who take issue with the policy. Environmentalists, taxpayers, food producers, consumer protection groups of all types, anti-hunger advocates and even farmers have all spoken out against the RFS.
95 percent of automobiles on the road today aren’t designed to run on gasoline that contains more than 10 percent ethanol.
Two Senators, Sen. Dianne Feinstein (D-CA) and Sen. Tom Coburn (R-OK), with almost opposite political points of view are coming together asking for reform on the ethanol mandate.
While ethanol producers are bringing in record profits, dairy and poultry farmers have been forced to close up shop, unable to afford feed for animals.
In his Washington Post blog post on the Renewable Fuel Standard, Ryan Cooper – just one of the paper’s resident Dems — called for an end to the corn ethanol mandate. Despite its good intentions, Cooper explained that the policy is just not living up to its promises.
Classic American cars. Ski boats and pontoons. Harleys. Snowmobiles. They’re all a part of what makes our Pure Michigan life so special. But they’re all also threatened by a broken federal policy known as the Renewable Fuel Standard.
The Renewable Fuel Standard has become an impossible-to-meet mandate, completely disconnected from market demand. The issues are countless – the looming blend wall, engine damage, increasing food prices, compliance fraud and increased GHG emissions.
Corn ethanol is forcing its way into the marketplace and is likely increasing greenhouse gas emissions, according to the National Academy of Sciences. In fact, corn-based ethanol nearly doubles GHG emissions over 30 years and increases greenhouse gases for 167 years.
Ethanol in fuel worries small-engine repair shop owners who recommend use regular gas in lawn mowers, snow throwers, chain saws, leaf blowers and the like. In recent years there has been a big upswing in repairs from homeowners who instead put ethanol-blended gas in their machines.
A congressional hearing was held on government-mandated renewable fuel standards (RFS). The consensus among industry analysts and experts was that the RFS policy is driving gasoline prices higher. The policy also is distorting energy markets and imposing economic burdens on millions of Americans.
Oil refiners oppose the ethanol mandate, but they are hardly the only ones who take issue with the policy. Environmentalists, tax payers, food producers and consumer protection groups of all types, anti-hunger advocates and even farmers have all spoken out against the RFS.
Concern over the blend wall has refiners snatching up RINs, ethanol credits available to fuel refiners looking to meet government-mandated biofuel production targets, causing the price spike. It’s not only the refiners that are buying up the credits, Wall Street has also taken an interest.
More than 40 percent of the United States' corn crop is now used to produce ethanol, and is hurting farmers who use corn for feed, food producers who rely on corn for their products and consumers. Ultimately, those increased costs make their way into our grocery bills.
Refiners are required by law to use 13.8 billion gallons of ethanol in 2013. Renewable Identification Numbers are attached to each gallon of ethanol to track compliance. Once the additive is blended into gasoline, refiners can retain the certificate to show compliance or trade it to another party.
The industry has hit what’s known as the “blend wall.” Hitting the blend wall is causing a host of complications for the ethanol industry, the Environmental Protection Agency, Congress, the petroleum industry and, maybe, the driving public.
The RFS created a market-based compliance system in which refiners must submit credits to prove that the required amount of renewable fuel is used or paid for by them each year. These credits, known as Renewable Identification Numbers, can be bought or sold like commodities.
The renewable fuel standard is causing unintended problems and Congress should idle the renewable fuel standard and find ways to ease the pressures caused by the current mandates without ending the program.
The result of the ethanol mandate, oil companies argue, is a “blend wall” that inevitably translates into higher gasoline prices for consumers, since oil firms have to buy special credits to make up for missing the law’s blending targets.
As the federally-mandated volume of ethanol usage increases and motor fuel consumption declines, to avoid lawsuits, gasoline refiners must purchase federal renewable "credits" to make up for the ethanol they don't blend, causing higher gasoline prices even in periods of lower demand.