Friday RFS Roundup – 8/15

August 15, 2014

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.”