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Friday RFS Roundup – 8/29

Late last week, the news was broken that the Environmental Protection Agency’s 2014 RFS proposal had finally made its way to the Office of Management and Budget (OMB). While we prepared ourselves for the final 90 days of deliberation, we heard predictions for the mandate and learned a bit about the economics of the policy.

  • The Economics of Biofuels:

    In Short:
    t would appear that the dream of growing the fuel required to keep the engines of industry humming — as well as the engines that enable many of our leisure pursuits — is simply too good to be true.”
     
  • Final Lobbying Push on 2014 RFS Begins; Analysts Say Significant Increases Unlikely:

    In Short: “Only “marginal” increases are expected when the Office of Management and Budget wraps up its review of the EPA proposal, which would require petroleum importers and refiners to blend a total of 15.21 billion gallons of renewable fuels into their products, Timothy T. Cheung of ClearView Energy Partners told Bloomberg BNA. That’s nearly 3 billion gallons less than the 18.15 billion gallons required by the Energy Independence and Security Act of 2007 (Pub. L. No. 110-140).

    ‘EPA is likely to stick with the proposed framework,’ said Cheung, who serves as a vice president and research analyst for the Washington, D.C.-based consulting firm.”

Friday RFS Roundup – 8/22

The big news from late this week is that the Environmental Protection Agency, now almost 9 months late on delivering the 2014 ethanol mandate, has finally passed the proposal along to the Office of Management and Budget (OMB) for review. In 90 days or less, we should have a rule.

Learn more from this week:

  • OPIS, EPA Spokeswoman: Final 2014 RFS Sent to OMB for Review: The EPA's proposed 2014 RFS, which was issued in November 2013, called for cuts to the ethanol mandate in an acknowledgment of the blend wall. We’ll see just how their proposal has changed in the last 10 months.

    In Short: “’After an extensive public outreach process, we've received 340,000 comments that will help inform our final determinations. EPA will issue a final rulemaking after the interagency review process has been completed.... The agency's overarching goal is to put the RFS program on a path that supports continued growth in renewable fuels over time,’ the spokeswoman added.”

    “Kevin Book, managing director of Clearview Energy Partners, explained, ‘[our] base case projects that EPA could set the total ethanol requirement to less than 13.6 billion gal [less than the 14.4 billion gal as originally prescribed] and maintain the biomass-based diesel requirement at 1.28 billion gal.’”
  • GlobalWarming.org, KiOR News Underscores Problems With Renewable Energy Industrial Policy: A guest post from Dave Juday, commodity market analyst and principal of The Juday Group, takes a look at the failing history of KiOR, once touted as the most successful U.S. biofuels producer.

    In Short: “Government mandates like RFS, subsidies, loan guarantees, and investments have not proven any better than the market for developing new energy resources – just much more costly.”
  • Midwest Energy News, Boating industry not backing down in Chicago E15 fight: The city of Chicago and the 13,000 or so boats that call it home, are in the midst of an ethanol debate. On July 28, after a five-hour committee hearing, the Chicago City Council decided not to advance the E15 ordinance, which would require all gas stations in the city to sell the ethanol blend. The region’s boating industry is sticking to its guns and pushing back on the ordinance which will likely come up again at hearing in the coming months.

    In Short: “Ethanol can be more corrosive and burns hotter than gasoline, so the higher ethanol blend can damage gaskets, valves and seals in engines not built to handle it. Warranties for boat engines typically are invalidated if E15 gas is used, according to David Dickerson, director of state government relations for the National Marine Manufacturers Association.”

    “If you fill up with E15 your boat engine will run rough, it’s going to be hard to start, and to restart, if you are out on the water and kill the engine,” Dickerson said. “Those are significant when you’re boating rather than driving. Being caught out on the water with no engine can be very dangerous, not just annoying.”

Friday RFS Roundup – 8/15

As the Environmental Protection Agency — now more than eight months later on delivering the 2014 rule — and Congress step away from the Hill, Americans, refiners and farmers alike continue to wait for movement from Washington on the ethanol mandate. This week, the media focused on some of the long-term effects the Renewable Fuel Standard (RFS) is having on food supply and our environment.

Learn more from this week:

Orange County Register, Andrew Purzder: U.S. needs corn for food more than for fuel: Andrew Puzder, the CEO of CKE Restaurants (Carl’s Jr.), explains how the ethanol mandate, which turns food into fuel, is hurting everyday Americans.

In Short: “Consumers experience the cost impact in their grocery stores and local restaurants. The RFS is particularly burdensome for restaurant franchisees, who are generally small-business owners operating with slim profit margins – sometimes just pennies on the dollar. With the RFS still in place, the increased cost of proteins restricts their ability to keep prices down and reduces the monies that otherwise would be available to support their communities, renovate facilities, open new locations or hire new employees.

A 2012 study by PricewaterhouseCooper commissioned by the National Council of Chain Restaurants to understand the impact of ethanol policies on chain-restaurant food costs, estimates that if the 2015 RFS mandate increased ethanol production by 6 billion gallons per year, it would increase commodity costs for chain restaurants by $3.2 billion per year. For quick-service restaurants alone, the estimated increase would be $2.5 billion per year.”

The Des Moines Register, We can’t let agriculture destroy our environment: Increased fertilizer runoff from expanding corn crops is causing even the people who benefit most from the RFS, Iowans, to question the policy’s legitimacy. 

In Short: “When a city has to stop drinking its water, something is seriously out of kilter.
Iowa could take steps to avoid that fate by limiting how much fertilizer farming operations use. Instead, Iowa lets them decide whether to voluntarily reduce nitrogen and phosphorus use — the sources of "toxic blooms" of algae. That isn't working.

Let's be realistic: If it's left to them, industries are likely to do what's easiest and costs them the least, which probably won't be in the best interests of residents and consumers.”

Green Builder Media, Lester Brown of Earth Policy Institute: Food Scarcity and Political Strategy: Environmental expert and founder of the Earth Policy Institute, Lester Brown, cites biofuels policies like the ethanol mandate as one reason the world is in a time of transition from a time of food surplus to one of food scarcity.

In Short: “Increasing use of grain to fuel vehicles is also straining our food supply. 400 million tons of grain are harvested in the U.S. each year. Of that amount, 130 million tons are allocated to ethanol distilleries to produce fuel for cars (the US has the highest level of grain use for transportation in the world).

… Using our precious food resource for transportation isn’t an efficient application for an already strained supply.”

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Legislative Updates will be coming soon.

A Coalition Against Bad Policy

We’ve said it once, and we’ll say it again… the ethanol mandate is everyone’s problem.

Oil refiners do oppose the ethanol mandate (primarily because of the looming blend wall), 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.

This year alone, our coalition has joined arms with even more poultry farmers who are struggling to feed their flocks due to the skyrocketing price of feed; gasoline retailers forced to stock a fuel that consumers neither know about nor want; and outdoor equipment groups grappling to find fuel that won’t damage their small engines.

On Thursday, April 10, Congressman Pete Welch (D-VT), Scott Faber of the Environmental Working Group, Rob Green of the National Council of Chain Restaurants and others will discuss how the ethanol mandate is impacting all Americans in an event hosted by The Hill Magazine in Washington, DC. You can watch the event on The Hill’s website or join the conversation on Twitter using #TheHillLive and #RFS2014.

The price you pay

NBC Nightly News shone a light this week on rising food prices that are impacting consumers across the United States.

While Brian Williams and the gang focused on the drought in California, it is important to note that these recent price increases are part of a longer-term trend.  Beef, poultry, milk and cheese prices have all been on the rise for nearly a decade—in fact, food prices are up 17.8 percent.

With the introduction of the Renewable Fuel Standard in 2005, the demand for ethanol increased making it more and more difficult for ranchers to feed their herds. By increasing the competition for and price of corn, the ethanol mandate has unintentionally been driving up the cost at the grocery store. By 2022, the RFS will increase food costs for Americans by $3 billion—annually—according to the Congressional Research Service.

And now the drought, which has been affecting various parts of the country since 2012, is making what is already bad, worse.

We can’t change the weather, but we can make changes to this failing policy. Tell Congress it’s time for a real solution.

Ghosts of Ethanol Past, Present and Future

In the holiday classic A Christmas Carol, the cold-hearted, greedy Ebenezer Scrooge is given a glimpse at his Christmas past, present and future. In our version of the story, we’re going to let you peek at ethanol’s ghosts.

Ethanol Past

While opposition to the Renewable Fuel Standard (the government’s ethanol mandates policy)is growing today, some have been wary of diverting food to fuel for decades. An article published by Nicholas Wade in 1979 reveals some of the early concerns:

“The rule of thumb in Iowa is that a 1 percent decrease in corn supply raises corn prices by 2 percent.”

Yet today, we divert more than 40 percent of our corn crops to ethanol, and we’ve felt the results in corn prices from the butcher to the baker.

Further, government has been subsidizing “gasohol” for years. In 1979, the going rate was 40 cents per gallon of E10 (a fuel blend containing ten percent ethanol).

And the final lesson from the ghost of ethanol past is this: we’ve been hoping for cellulosic biofuels forever. More on that later…

Ethanol Present

Unfortunately, the realities of today’s ethanol mandate (the RFS) are no better. Refiners, environmentalists, ranchers, world hunger groups, wildlife advocates, journalists and even the Environmental Protection Agency all take issue with one part of the policy or another.

Ethanol Future

All wounds heal with time, right? Actually, no, according to Energy Information Administration. Despite   the ethanol lobby promising that cellulosic (non-corn) biofuels are “just around the corner,” the U.S. government’s Energy Information Administration’s (EIA) annual American Energy Outlook report tells us that even by 2040, it is unlikely that we’ll be anywhere close to the mandated level of cellulosics.

This means decades more subsidies for the industry and continued reliance on corn to meet the ethanol mandate.

Just like Scrooge, it’s time for Congress to see the error in its ways.

Tell your Congressman to reform the Renewable Fuel Standard.

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Smarter Fuel Future Advocates’ Ethanol Warning Labels

From Barbara T.



From Bill S.



From Bradford T.



From David A.



From Dudley D.



From Edward G.



From Franklin M.



From Howard S.



From Linda R.



From Lisa W.



From Lucinda S.



From Marilyn L.



From Mary O.



From Mike R.



From Patricia C.



Phillip R.



From Tom K.



From Walter E.



From William T.
 

 

Comparing the Ethanol Mandate with Projected Ethanol Demand

Consumer Price Index Since Ethanol Mandate

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The Truth about Ethanol and the Renewable Fuel Standard

State of the Union BINGO

Tonight President Obama will address the joint houses of Congress, as well as the American people, setting the agenda for the executive branch for the coming year.

For those in DC, it’s a big night out, but if you’d like to play along at home while watching the State of the Union, we’re happy to oblige.

Download our SOTU Bingo cards and every time President Obama mentions an RFS consequence or something political ridiculous happens, mark your card!

Also – today is the last day for you to tell the EPA to lower the ethanol mandate. Make sure you tell the EPA you support lowering the mandate!

Bedfellows Coalition Letter to the House of Representatives Energy & Commerce Committee

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Friday RFS Roundup – 8/29

Late last week, the news was broken that the Environmental Protection Agency’s 2014 RFS proposal had finally made its way to the Office of Management and Budget (OMB). While we prepared ourselves for the final 90 days of deliberation, we heard predictions for the mandate and learned a bit about the economics of the policy.

  • The Economics of Biofuels:

    In Short:
    t would appear that the dream of growing the fuel required to keep the engines of industry humming — as well as the engines that enable many of our leisure pursuits — is simply too good to be true.”
     
  • Final Lobbying Push on 2014 RFS Begins; Analysts Say Significant Increases Unlikely:

    In Short: “Only “marginal” increases are expected when the Office of Management and Budget wraps up its review of the EPA proposal, which would require petroleum importers and refiners to blend a total of 15.21 billion gallons of renewable fuels into their products, Timothy T. Cheung of ClearView Energy Partners told Bloomberg BNA. That’s nearly 3 billion gallons less than the 18.15 billion gallons required by the Energy Independence and Security Act of 2007 (Pub. L. No. 110-140).

    ‘EPA is likely to stick with the proposed framework,’ said Cheung, who serves as a vice president and research analyst for the Washington, D.C.-based consulting firm.”

Friday RFS Roundup – 8/22

The big news from late this week is that the Environmental Protection Agency, now almost 9 months late on delivering the 2014 ethanol mandate, has finally passed the proposal along to the Office of Management and Budget (OMB) for review. In 90 days or less, we should have a rule.

Learn more from this week:

  • OPIS, EPA Spokeswoman: Final 2014 RFS Sent to OMB for Review: The EPA's proposed 2014 RFS, which was issued in November 2013, called for cuts to the ethanol mandate in an acknowledgment of the blend wall. We’ll see just how their proposal has changed in the last 10 months.

    In Short: “’After an extensive public outreach process, we've received 340,000 comments that will help inform our final determinations. EPA will issue a final rulemaking after the interagency review process has been completed.... The agency's overarching goal is to put the RFS program on a path that supports continued growth in renewable fuels over time,’ the spokeswoman added.”

    “Kevin Book, managing director of Clearview Energy Partners, explained, ‘[our] base case projects that EPA could set the total ethanol requirement to less than 13.6 billion gal [less than the 14.4 billion gal as originally prescribed] and maintain the biomass-based diesel requirement at 1.28 billion gal.’”
  • GlobalWarming.org, KiOR News Underscores Problems With Renewable Energy Industrial Policy: A guest post from Dave Juday, commodity market analyst and principal of The Juday Group, takes a look at the failing history of KiOR, once touted as the most successful U.S. biofuels producer.

    In Short: “Government mandates like RFS, subsidies, loan guarantees, and investments have not proven any better than the market for developing new energy resources – just much more costly.”
  • Midwest Energy News, Boating industry not backing down in Chicago E15 fight: The city of Chicago and the 13,000 or so boats that call it home, are in the midst of an ethanol debate. On July 28, after a five-hour committee hearing, the Chicago City Council decided not to advance the E15 ordinance, which would require all gas stations in the city to sell the ethanol blend. The region’s boating industry is sticking to its guns and pushing back on the ordinance which will likely come up again at hearing in the coming months.

    In Short: “Ethanol can be more corrosive and burns hotter than gasoline, so the higher ethanol blend can damage gaskets, valves and seals in engines not built to handle it. Warranties for boat engines typically are invalidated if E15 gas is used, according to David Dickerson, director of state government relations for the National Marine Manufacturers Association.”

    “If you fill up with E15 your boat engine will run rough, it’s going to be hard to start, and to restart, if you are out on the water and kill the engine,” Dickerson said. “Those are significant when you’re boating rather than driving. Being caught out on the water with no engine can be very dangerous, not just annoying.”

Friday RFS Roundup – 8/15

As the Environmental Protection Agency — now more than eight months later on delivering the 2014 rule — and Congress step away from the Hill, Americans, refiners and farmers alike continue to wait for movement from Washington on the ethanol mandate. This week, the media focused on some of the long-term effects the Renewable Fuel Standard (RFS) is having on food supply and our environment.

Learn more from this week:

Orange County Register, Andrew Purzder: U.S. needs corn for food more than for fuel: Andrew Puzder, the CEO of CKE Restaurants (Carl’s Jr.), explains how the ethanol mandate, which turns food into fuel, is hurting everyday Americans.

In Short: “Consumers experience the cost impact in their grocery stores and local restaurants. The RFS is particularly burdensome for restaurant franchisees, who are generally small-business owners operating with slim profit margins – sometimes just pennies on the dollar. With the RFS still in place, the increased cost of proteins restricts their ability to keep prices down and reduces the monies that otherwise would be available to support their communities, renovate facilities, open new locations or hire new employees.

A 2012 study by PricewaterhouseCooper commissioned by the National Council of Chain Restaurants to understand the impact of ethanol policies on chain-restaurant food costs, estimates that if the 2015 RFS mandate increased ethanol production by 6 billion gallons per year, it would increase commodity costs for chain restaurants by $3.2 billion per year. For quick-service restaurants alone, the estimated increase would be $2.5 billion per year.”

The Des Moines Register, We can’t let agriculture destroy our environment: Increased fertilizer runoff from expanding corn crops is causing even the people who benefit most from the RFS, Iowans, to question the policy’s legitimacy. 

In Short: “When a city has to stop drinking its water, something is seriously out of kilter.
Iowa could take steps to avoid that fate by limiting how much fertilizer farming operations use. Instead, Iowa lets them decide whether to voluntarily reduce nitrogen and phosphorus use — the sources of "toxic blooms" of algae. That isn't working.

Let's be realistic: If it's left to them, industries are likely to do what's easiest and costs them the least, which probably won't be in the best interests of residents and consumers.”

Green Builder Media, Lester Brown of Earth Policy Institute: Food Scarcity and Political Strategy: Environmental expert and founder of the Earth Policy Institute, Lester Brown, cites biofuels policies like the ethanol mandate as one reason the world is in a time of transition from a time of food surplus to one of food scarcity.

In Short: “Increasing use of grain to fuel vehicles is also straining our food supply. 400 million tons of grain are harvested in the U.S. each year. Of that amount, 130 million tons are allocated to ethanol distilleries to produce fuel for cars (the US has the highest level of grain use for transportation in the world).

… Using our precious food resource for transportation isn’t an efficient application for an already strained supply.”

Show More