Reaction to EPA's 2017 RFS proposal

On Wednesday, the Environmental Protection Agency (EPA) released a proposed rule to set Renewable Volume Obligations (RVO) under the Renewable Fuel Standard (RFS) for 2017. EPA proposed a total renewable fuel volume of 18.8 billion gallons, including 14.8 billion for corn ethanol.

The numbers are an increase from 2016 RVO levels, but still fall short of the numbers set by Congress in the RFS, which is legislation that sets annual targets for the amount of cleaner-burning biofuels like corn ethanol blended into our fuel supply.

Below are reactions to EPA’s announcement from national leaders in biofuels and agriculture:

NCGA President Chip Bowling

From Maryland farmer and National Corn Growers Association President Chip Bowling:

“EPA has moved in a better direction, but we are disappointed that they set the ethanol number below statute. The Renewable Fuel Standard is working for America. It has made our air cleaner. It has spurred investment in rural communities and created high-tech jobs. It has given drivers more choices at the gas pump. And it has reduced our dependency on foreign oil. Any reduction in the statutory amount takes America backward – destabilizing our environment, our economy, and our energy security.

“In the past, the EPA has cited a lack of fuel infrastructure as one reason for failing to follow statute. Our corn farmers and the ethanol industry have responded. Over the past year, we’ve invested millions of dollars along with the U.S. Department of Agriculture’s Biofuel Infrastructure Partnership to accelerate public and private investment in new ethanol pumps and fuel infrastructure. The fact is, today’s driver has more access than ever to renewable fuel choices.

“America’s corn farmers and the ethanol industry have done their job. NCGA will continue fighting to hold the government accountable for its promises. We call on the EPA to follow the law, and raise the ethanol volume to statute.

“In the coming weeks, the EPA needs to hear from all of us: farmers, neighbors, community leaders and anyone who cares about stability for our rural economy. If you want clean air, a strong economy and vibrant rural communities, and energy independence, we need you to help stand up for the Renewable Fuel Standard. Ask the EPA to raise the RVO to statute.”

Brian Jennings, American Coalition for Ethanol

From Brian Jennings, Executive Vice President of the American Coalition for Ethanol (ACE):

“A top excuse EPA has used to rein-in the RFS is data from the U.S. Energy Information Administration (EIA) which indicate falling gasoline consumption.  EPA has claimed they can’t require oil companies to add more ethanol to a shrinking gasoline pool because of the so-called E10 blend wall,” said Jennings.  “Under that logic, EPA’s ethanol blending volumes for 2017 should increase to statutory levels because gasoline use is on a steady rise and will set a new record this year.”

According to EIA, gasoline use rose to 9.2 million barrels per day (bpd) in 2015 – just shy of the 2007 record of 9.29 million bpd.  In 2016, EIA predicts a new gasoline use record of 9.3 million bpd will be set and that trend will continue into 2017.

“While we are pleased that EPA’s 2017 proposal increases ethanol blending levels from 2016, we remain disappointed that EPA falls back on the questionable E10 blend wall methodology which has disrupted implementation of the RFS for more than a year,” said Jennings.  “Our priority is to ensure EPA holds oil companies legally responsible under the RFS for making cleaner and less expensive fuel choices, such as E15 and flex fuels, available to consumers.  We will provide ACE members with a platform to once again submit comments to EPA so we can work to improve upon this proposal in advance of the final rule which will be issued on November 30.”

Infrastructure constraint excuses don’t hold water either.  In 2015 the U.S. Department of Energy’s National Renewable Energy Laboratory issued a report confirming that most retail infrastructure is already compatible with E15.  The majority of cars on the road are approved to use E15.

From Renewable Fuels Association (RFA) President Bob Dineen:

“For months, EPA has been saying it plans to put the program ‘back on track.’ Today’s proposal fails to do that. The agency continues to cater to the oil industry by relying upon an illegal interpretation of its waiver authority and concern over a blend wall that the oil industry itself is creating. As a consequence, consumers are being denied higher octane, lower cost renewable fuels. Investments in new technology and advanced biofuels will continue to languish and greenhouse gas emissions from automobiles will be unnecessarily higher.

“The real frustration is that EPA seems to be artificially constraining this market. The RFA has demonstrated just how easy it would be for obligated parties to reach the 15 billion gallon statutory volume for conventional biofuels next year. The fact is with rising gasoline demand, increased E15 and E85 use made possible by USDA’s infrastructure grant program, continued use of renewable diesel and conventional biodiesel that also generate D6 RINs (renewable identification numbers), well more than 15 billion gallons will be used next year. All of that is in addition to the 2 billion surplus RINs available to refiners due to EPA’s tepid enforcement of the RFS in the past.

“EPA can be given credit for two things—getting the proposal out in a timely fashion and at least coming within a mere 200 million gallons of the statutory level of 15 billion gallons for conventional biofuels. As this process continues, we intend to work to encourage a final rule that truly puts the RFS ‘back on track.’ As it is, today’s proposal is a lost opportunity for this administration to cement its legacy in clean fuels, advanced biofuel and climate change.”

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