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Friday RFS Roundup – 12/5

As we approach yearend without a 2014 ethanol mandate, discussion this week covers the worries consumers have about the future of our gas prices and food security.

More from this week:

What’s Corn Got to Do With It? World Hunger and America’s Largest Crop:

In Short: “Ethanol has been widely criticized over the years, yet growing corn for fuel is a booming industry. According to NPR, there is more than eight times more ethanol in the U.S. now than there was in 2000; increasing ethanol use is good news for farmers, who often produce more corn than they know what to do with, but bad news for just about everyone else.”

Why gasoline prices are down:

In Short: “Repeal the ethanol mandate. This rule forces refineries to blend increasing amounts of ethanol into gasoline each year, reaching 36 billion gallons in 2022. It’s already driven up fuel and food prices, according to multiple federal-agency and government-backed studies.”

EPA PUNTS AGAIN:

In Short: “So, we will finish the 2014 compliance period without a 2014 RFS final rule. But what does this mean for 2015? At least 2015 does not have elections for the U.S. Senate or the U.S. House of Representatives. But we know that the Agency will be late again, because the proposal for the 2015 RFS has not yet been sent to OMB for interagency review. Recall that the final rule for the 2015 RFS should be issued by November 30, 2014. EPA expects the 2015 RFS proposal to be issued in May 2015, but RFS tardiness is not new: after all, EPA did not promulgate the 2013 RFS final rule until August 2013. Given these constant stoppages, maybe the title of this blog should actually be “Delay, Delay, Delay, and Delay Some More.””

Forgetting 2014

"We give up."

That's basically what the Environmental Protection Agency said in late November, in announcing that — despite being a year late — they still can't figure out how to set the ethanol mandate for 2014.

The EPA is hurting everyone by creating instability in the corn market, which impacts refiners, corn farmers, livestock producers and consumers together. The EPA’s favorite tactic, delaying the final rule for the 2014 RFS until sometime next year, is further proof that the policy is broken and the agency is no longer a good steward. It is time for Congress to take bipartisan action on the Renewable Fuel Standard instead.

Some say it's politics. Some say it's government bureaucracy gone wrong. Some say it's Big Corn doing whatever it can to protect its profits.

But to us it means more families struggling with the price of food. It's more pain at the pump. It's more environmental damage. It's more hunger. It's more closed farms and harmed businesses. It's more engines put at risk.

Demand reform on the ethanol mandate from your Congressman!

EPA Announces the Rule for 2014 is No Rule At All

More than a year after announcing a plan to lower the ethanol mandate for 2014, the Environmental Protection Agency has decided that the policy is so broken, it is easier to give up than announce a final rule.

EPA said the agency will “take action on the 2014 standards rule in 2015 prior to or in conjunction with action on the 2015 standards rule.” The deadline for 2013 compliance with the rule will take place in 2015, EPA’s notice says.

See how others are reacting to the EPA’s decision and check back for more responses:

Environmental Working Group’s policy analyst Mike Lavender says:
Today's announcement is further evidence that Congress must reform our badly broken food-to-fuel policies. By failing to reduce the amount of corn ethanol blended into gasoline, the Obama administration today missed an opportunity to immediately reduce greenhouse gas emissions. If we hope to reverse climate change, we need greenhouse gas reductions now, not in 2025, and reducing the amount of corn ethanol in gasoline is among the most effective tools at the administration’s disposal. We urge the administration to quickly finalize a RVO that paves the way for truly “green” biofuels."

National Chicken Council President Mike Brown says:
“This seesaw process by which the EPA proposes an up-and-down, now-and-later moving target as the compliance year unfolds leaves poultry and livestock producers unable to plan and budget effectively. While corn prices have moderated, volatility and uncertainty are the true business-killers. On top of all of this, we believed at one time that the original RFS included a workable provision that provided for an ‘off ramp’ in times of economic crisis.  On at least two major occasions – in 2008 and 2012 during catastrophic weather events – that belief has proven false. What more evidence does the administration and Congress need to prove the RFS — and the administration of it — is broken beyond repair? Albert Einstein is said to have observed, ‘Insanity is doing the same thing over and over, and expecting different results.’  Today’s announcement is further evidence that our current renewable fuel policy is not only broken, it’s insane.”

House Energy and Commerce Committee's Chairman Fred Upton (R-MI), Ed Whitfield (R-KY) and John Shimkus (R-IL) say:
“Businesses and consumers have been waiting a year now for clarity and guidance from EPA, but this decision to completely abandon the 2014 targets only adds to the growing uncertainty and frustration. EPA cannot just choose to arbitrarily ignore the law and the deadlines established by Congress. This unexpected announcement highlights that there are still significant challenges facing the RFS and underscores the need to come together and find a practical, bipartisan solution.”

American Fuel & Petrochemical Manufacturer’s President Charles T. Drevna says:
“The Obama Administration’s decision to further delay issuing the 2014 Renewable Volume Obligations (RVO) is a gross dereliction of responsibility that leaves fuel refiners and the biofuels industry alike to navigate a course of ambiguity. Today’s announcement indicates that the Administration plans to continuously mismanage this program in a manner that equates to playing Russian roulette with the nation’s fuel supply at the American consumer’s ultimate expense. The Administration’s inaction demonstrates once again that the non-functioning Renewable Fuel Standard (RFS) program is irreparably broken. AFPM calls upon Congress to expeditiously resume work on repealing or significantly reforming the RFS. In the meantime, AFPM will seek legal intervention. For three years in a row, the Administration has thumbed its nose at Congress and ignored a crystal clear statutory deadline to issue RVOs by November 30 of the preceding year. For this reason, AFPM today filed a notice of intent to sue EPA over its failure to issue the 2014 RFS regulations, which has languished at the White House Office of Management and Budget since August 22, 2014.”

The National Council of Chain Restaurants’ Executive Director Rob Green says:
“By backtracking on their initial recommendation on the ethanol mandate quota, the White House and EPA have chosen to accommodate a small group of ethanol lobbyists at the expense of American consumers and diners, the nation’s small business restaurant owners and all businesses that support and sustain the food supply chain. This unbelievable non-announcement demonstrates once and for all that the EPA, because of statutory and political considerations, cannot fix the failure of the RFS. Members of Congress should take note. The federal RFS ethanol mandate is irrevocably broken and needs to be repealed immediately. It is time that Congress take the RFS ‘off the menu’ once and for all.”

ActionAid USA’s Director of Policy and Campaigns Kristin Sundell says:
As the Administration stands by this failed policy, today’s decision to leave biofuels targets unchecked means corn for fuel tanks will be prioritized over food for hungry people around the world. It will also make prices for foods such as corn and soya more unstable, hitting poor people in the US and abroad hardest. Poor people around the world should not have to go hungry to produce fuel for our cars and trucks. Congress must act to reform its biofuel mandates.”

National Marine Manufacturers Association says:
“We have serious, well-documented and data-driven concerns with the safety of high ethanol fuel blends which have been proven to cause damage to marine engines. This damage puts consumers at risk and hurts manufacturers during a time of important economic recovery. The RFS is a broken law which sets unrealistic fuel mandates and requires a long term fix from Congress. NMMA strongly encourages Congress to address the issues of the RFS directly through legislation in order to protect consumers and US manufacturers.”

BoatUS Government Affairs Program Manager Nicole Palya Wood says:
“There is solid scientific data that supports levels of ethanol in gasoline over 10% damage marine engines. The EPA’s failure to efficiently administer this program, utilize its waiver authority and set standards that provide protections for consumers sends a clear message that congress must act now to reform the RFS. We were hoping the EPA would utilize their waiver authority to ease the pressure on the nation’s fuel supply with regard to ethanol. Now, with their failure to act, it’s even more critical we work for a Congressional legislative fix which would bring the investment in safer, more compatible renewable fuels, which was what the RFS originally intended.”

A Most Disappointing First Anniversary

It’s official: one year ago, the Environmental Protection Agency acknowledged reality and proposed lowering the 2014 ethanol mandate to avoid reaching the blend wall and a spike in gas prices. You may remember, our partners were pretty thrilled.

Unfortunately, in the 365 days since, exactly zero progress has been made. With only 47 days left in the year, corn farmers, livestock producers, restaurateurs, refiners and the American public are still waiting for the final ethanol mandate numbers to be set for this year.

While their desired outcomes vary, refiners, Congressmen and ethanol producers have all urged the White House for a decision. No matter who wins, everyone agrees that the delay is costly for everyday Americans.

The RFS isn't a policy that we can depend on. Tell Congress today that we need them to fix a policy that's so broken it can't even be implemented on time.

Friday RFS Roundup – 11/14

As the Office of Management and Budget continues to sit on the 2014 ethanol mandate, which is more than 10 months late, advance biofuels sweetheart KiOR files for bankruptcy and EWG and AAA expose the problems with corn ethanol.

More from this week:

Corn Ethanol Clips Your Car's MPG:

In Short: “From year to year, EPA tweaks the maximum amount of ethanol required in vehicle fuel, based on U.S. fuel consumption. If EPA bumps up that number, it will exacerbate problems corn ethanol already poses to consumers…But the damage won’t be limited to engines. An EPA decision to increase the amount of corn ethanol in gasoline could lead to more pollution in air and water.”

RIP KiOR: The Khosla-backed biofuel company finally files for bankruptcy:

In Short: “Biofuel startups looking to produce next-generation fuels using plant waste (instead of corn and soybeans) have proven to be incredibly difficult to scale up. Almost none have survived the so-called ‘valley of death’ from small scale production to large scale commercialization at the low price point needed to compete with oil.”

Friday RFS Roundup – 11/7

Now that the midterm elections have passed, consumers are looking to politicians and policymakers to carry out their word to amend the ethanol mandate. This week legislators and taxpayers discussed the future of the post-election American economy as the White House Office of Management and Budget reviews the EPA’s ethanol proposal.

More from this week:

U.S. Sen. Pat Toomey sees 'huge opportunity' with incoming GOP Senate majority:

In Short: “U.S. Sen. Pat Toomey, R-Pa. said he's going to be focusing on a ‘pro-growth agenda’ — ‘agenda that will help encourage economic growth in Pennsylvania.’ That entails, Toomey said, approving the Keystone XL pipeline, approving the exporting of liquefied natural gas, and a ‘rollback’ of ‘the ethanol mandate.’"

For Cellulosic Ethanol Makers, The Road Ahead Is Still Uphill:

In Short: “For the Environmental Working Group’s Craig Cox, the economic and policy complications raise important questions for both the industry and policymakers. ‘I think it raises the larger question,’ Cox said. ‘Are we on the right biofuel road?’ If we could wipe the slate clean, and sit down and say, ‘OK, we want a biofuel that could make a substantial contribution to reducing fossil fuels, and would actually reduce greenhouse gases from liquid transportation, and was good for the environment, good for the air, good for soil, good for water — would we have picked corn ethanol?’ he said. ‘I think the answer is clearly no.’”

Enough of big ethanol bullying consumers:

In Short: “For taxpayers, Big Ethanol’s attempt at manipulating the market is also economically damaging. The increased costs for equipment upgrades and compliance credits on fuel suppliers will contribute to higher gas prices. Just this year, the Congressional Budget Office found that the RFS will raise the price of regular E10 gasoline by as much as 26 cents per gallon. It’s no wonder consumers have demonstrated no interest in consuming any more ethanol than they already do.”

Friday RFS Roundup – 10/31

Discussion from this week covers the effects that the mandate has on the average American consumer. From the massive amounts of land needed to produce biofuels to the decreasing energy content in gasoline, the ethanol mandate is a burden on our resources.

More from this week:

What will it take to feed the world in 2050?:

In Short: “Stop diverting so much of our food and feed to biofuel production, which the National Academy of Sciences estimated was responsible for 20-40 percent of the 2008 price spikes. FAO’s food projections do a poor job of incorporating biofuels into their estimates, and biofuels are one of the leading non-food uses of agricultural land. According to the International Energy Agency, crop-based biofuels demand will grow 150 percent by 2035 if we don’t change our policies. Government consumption mandates, such as the U.S. Renewable Fuel Standard, must be scaled back, an action that can do far more to keep food prices in check than investing in expanded agricultural commodity production.”

Increasing ethanol use has reduced the average energy content of retail motor gasoline:

In Short: “Ethanol and other oxygenates, which have lower energy content than petroleum-based gasoline components, have seen their share of total gasoline volumes increase from 2% in 1993 to nearly 10% in 2013. As a result, EIA's estimate of motor gasoline's average energy content per gallon has declined by about 3% over this 20-year period.”

Know your candidates

The 2014 mid-term elections are just one week away, and now is the time to really get to know the candidates. The best way to get Congress to fix the Renewable Fuel Standard (RFS) is to make sure we elect people who know the facts and are ready to make a change.

Use our sheet below to ask your local politicians the right questions.

For the sake of our environment, our economy and your wallet, let the candidates know that you expect them to take action to reform this failing policy. Before you vote on November 4, make sure you know who you can count on to change the RFS.

Friday RFS Roundup – 10/24

Discussion this week focused on the diversity in challenges and consequences facing the ethanol mandate from environmental damage to low consumer demand for biofuels.

More from this week:

Will Biofuels Be Better For Plastics Than For Vehicle Fuel?:

In Short: “Increased ethanol production is required to meet government mandates, but low demand for the fuel from consumers is leading companies now in production to seek out other uses for their alcohol fuel.”

EPA’s Sleight of Hand on Cellulosic Fuel Rule Change:

In Short: “Unfortunately, the EPA, which was created to protect the nation’s land, water, and air from pollution, has become a politicized propaganda instrument for the administration’s biofuels agenda, and is intent on pushing an RFS policy that is undermining its institutional mandates in addition to harming Americans more directly.”

Corn Belt Pollution: Louisiana Shrimp And Oysters Pay The Price:

In Short: “Nitrogen run-off from the nation’s booming Corn Belt is the single largest source of nutrient pollution in the Mississippi River basin, which drains a stunning 41 percent of the waterways in the contiguous United States. Massive amounts of water, sediment and nutrients wash off cornfields from as far away as Minnesota, enter the Mississippi River system, and eventually reach the Gulf. The problem may worsen if the Environmental Protection Agency (EPA) raises the ethanol mandate for blended gasoline next month—despite earlier commitments to reduce it. Fully one-third of corn grown in the U.S. already goes to ethanol refiners today, and that number could climb.”

What it means to “Grow Ethanol”

On a recent trip to Indiana, President Obama offhandedly mentioned that “growing” ethanol is one way to put rural Americans back to work. Unfortunately for us, ethanol doesn’t grow on trees and turning the crop from food to fuel actually requires a great deal of effort and resources.

The Renewable Fuel Standard (known as the ethanol mandate) is a government mandate to fill our gas tanks with biofuels. The policy was supposed to be better for the environment than traditional gasoline and a way to increase demand, and therefore prices, for American farmers. 

But in fact, multiple government and academic studies have found that it actually does more harm than good to the environment and the rural economies it was supposed to bolster.

Here’s how:

Environmental Damage

Corn uses the most fertilizer of all major U.S. crops—more than half of all commercial fertilizer applied to U.S. cropland (195 pounds of fertilizer per acre of corn). Nitrous oxide (N2O), a greenhouse gas that is released from the fertilizers used to grow corn, has 298 times the global warming potential of carbon dioxide and is the single largest source of pollution to the Gulf of Mexico’s “dead zone” and the second largest source of impairments to wetlands.

To refine corn into one gallon of E10, a 10% ethanol mixture that is standard today but not enough to continue meeting the mandate, requires 170 gallons of water versus the five gallons that gasoline requires.

Not to mention, when considering the full lifecycle, corn-based ethanol nearly doubles GHG emissions over 30 years and increases greenhouse gases for 167 years.

Rural Economies

While mandating ethanol has been good for ethanol producers, the policy has negatively impacted the livestock farmers and ranchers who rely on reasonable corn prices for animal feed. This has contributed to the closing of more than 60,000 pork, poultry and beef operations since 2007, when the policy was expanded.

Animal agriculture supports 20 times more jobs than the ethanol industry, so a policy that favors ethanol over food production hurts our economy.

While it’s true that right now corn prices are low, the Environmental Protection Agency — charged with making reasonable adjustments to the mandate annually — is more than ten months late in finalizing the 2014 mandate, which causes the kind of instability in the corn market that hurts everyone, corn and livestock farmers alike.

And cellulosic ethanol plants haven’t yet materialized as the rural job creators once hoped for. The federal government has spent hundreds of millions to prop up the cellulosic industry, yet many of the companies that received those funds have since gone out of business.

Forcing ethanol into our fuel supply damages both the American economy and our environment. Tell Congress to take action on this failing policy.