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Renewable Fuel Standard 'Comes a Cropper' of Food and Ranching Industries
Green Technology Featured Articles
April 15, 2013

Renewable Fuel Standard 'Comes a Cropper' of Food and Ranching Industries

By Cheryl Kaften
TMCnet Contributor

Should we be feeding corn to our cattle, poultry, and families or filling our gas tanks with an eco-friendly derivative of the crop? Legislation proposed in the U.S. House last week would roll back requirements of the Renewable Fuel Standard Act in order to keep the price of corn reasonable for consumers, ranchers, and poultry farmers.


What is the Renewable Fuel Standard Act? It comprises a set of regulations — implemented by the U.S. Environmental Protection Agency (EPA) — that ensure that transportation fuel sold in the United States contains a minimum volume of renewable fuel. The Renewable Fuel Standard (RFS) mandates that 36 billion gallons of renewable fuels be part of America’s fuel supply by 2022. 

To date, almost all of the RFS has been fulfilled by corn ethanol.  In 2011, 5 billion bushels of corn were used for ethanol —equal to nearly 40 percent of the U.S. corn crop. A final EPA rule, set to take effect on May 5, provides other “pathways” to meeting the mandate—including biomass or biogas, crop residue, tree resident, annual cover crops; and cellulosic components of separated food waste and solid waste.


Image courtesy of Shutterstock

The EPA has clarified that, “This final rule also qualifies renewable gasoline and renewable gaso­line blendstock made from certain qualifying feedstocks as cellulosic biofuel. By qualifying these new fuel pathways, this rule provides opportuni­ties to increase the volume of advanced, low-GHG [greenhouse gas] renewable fuels— such as cellulosic biofuels— under the RFS program. EPA’s compre­hensive analyses show significant lifecycle GHG emission reductions from these fuel types, as compared to the baseline gasoline or diesel fuel that they replace. Lastly, the rule clarifies the definition of renewable diesel to explicitly include jet fuel. This clarification offers additional market certainty and opportunity for renewable diesel producers.”

A ‘Corn Row’

However, the Renewable Fuel Standard (RFS) Reform Act, introduced on April 10 by Reps. Bob Goodlatte (R-Va.), Jim Costa (D-Calif.), Steve Womack (R-Ark.) and Peter Welch (D-Vt.), would eliminate the biofuels mandate, beginning in 2014, and rescind the requirements of blending up to 15 percent ethanol into the fuel supply. Instead, the act would cap the amount of ethanol to be blended into conventional gasoline at 10 percent and require the EPA to set production levels for cellulosic biofuels. The proposal would prohibit corn-based ethanol from being used to meet the RFS and reduce the total size of the RFS by 42 percent over the next nine years.

A statement by the Congressmen presented their rationale for the rollback:  The RFS debate is no longer just a debate about fuel or food.  It is also a debate about jobs, small business, and economic growth.  The federal government’s creation of an artificial market for the ethanol industry has quite frankly triggered a domino effect that is hurting American consumers, energy producers, livestock producers, food manufacturers, and retailers.  The broad coalition of organizations supporting this legislation echo the same sentiment: The RFS is not working.”

They explained, “While the RFS is causing food prices to go up, the RFS has not provided relief for consumers at the pump.  In fact, citing the RFS, the EPA is setting the target for refiners to blend cellulosic biofuels into gasoline higher than the amount of cellulosic biofuels that exists.  When these non-existent fuels cannot be blended refiners are financially penalized, which ultimately gets passed on to consumers at the pump.”

Grocery Manufacturers Association President and CEO Pamela G. Bailey, concurred, remarking, “Americans need responsible energy policy solutions that do not pit our nation’s energy needs against food security for millions of families. GMA applauds Reps. Goodlatte, Costa, Welch and Womack for taking an important step towards reforming the ill-conceived food-for-fuels policies that are driving up the cost of food for consumers when they can least afford it.”

The Centennial, Colorado-based National Cattlemen’s Beef Association(NCBA) and the Washington, DC-based National Pork Producers Council (NPPC) also issued a statement in support of the legislation.“Cattlemen and women are self-reliant, but in order to maintain that we cannot be asked to compete with federal mandates like the Renewable Fuels Standard for the limited supply of feed grains,” said NCBA Policy vice-chair Craig Uden, an Elwood, Neb., cattle feeder. “In light of the worst drought to hit our country in over 50 years and the ever increasing renewable mandates, we are seeing many of our members not only failing to profit, but taking a loss.”

NPPC President Randy Spronk, a pork producer from Edgerton, Minnesota, said, “It is clear, when EPA is unable to provide even a temporary waiver of the RFS during the worst drought in 70 years to assure adequate feed and food supplies, that something is broken and needs to be fixed. We applaud Congress, and especially Congressmen Goodlatte, Costa, Womack and Welch, for beginning this long overdue conversation on the RFS and for offering reasonable solutions to address problems associated with that mandate. We need to reform the RFS.”

Others that have come out in support of the RFS Reform Act includeActionAid USA, the American Frozen Food Institute, the American Meat Institute, the Competitive Enterprise Institute, the Environmental Working Group, the Grocery Manufacturers Association, the Milk Producers Council, the National Cattlemen’s Beef Association, the National Chicken Council, the National Council of Chain Restaurants, the National Marine Manufacturers Association, the National Restaurant Association, the National Taxpayers Union, the National Turkey Federation, the Outdoor Power Equipment Institute, and Taxpayers for Commonsense.

Support for the RFS

However, on March 15, the Governor’s Biofuels Coalition met in Sioux Falls and sent a letter to members of Congress in support of the Renewable Fuels Standard. The letter from the 30 governors represented by the coalition, led by Iowa Governor Terry Branstad (R), urges Congress to stay the course on the RFS. “As governors who see firsthand the impact that the RFS has had on our states, we urge you to reject any modifications to the RFS,” the letter reads. “By intentionally using misinformation, biofuels opponents damage the nation’s economy, environment, and energy security.”

Bob Dinneen, president and CEO of the Washington, DC-based Renewable Fuels Association, said, “The motivation behind this bill is backwards, silly, circular logic. The authors insist they’re not anti-biofuels, but the bill guts the only program that has successfully opened the market to these new technologies, lowering our dependence on imported oil and reducing the consumer price of gasoline. The authors state they want a ‘free market’ for energy, but they do nothing to end the billions in subsidies to Big Oil and they deny market access to E15. The authors portend to retain the mandate for new cellulosic and advanced biofuels, but the bill handcuffs the commercialization of these fuels by removing the forward-looking, market-driving provisions of the original legislation.”

Dinneen added, “You can’t legitimately say ‘we support biofuels’ and then pull the rug out from underneath companies that relied upon government policy and are now building biorefineries that create hundreds of construction jobs at each location or are hitting milestones in new production. This legislation should have been introduced on Halloween because it will scare away investors.”

Finally, Brooke Coleman, executive director of the Washington, DC-based Advanced Ethanol Council, released the following statement: “Congressman Goodlatte (R-VA) gets points for being creative. Disguised as a reform effort supportive of advanced biofuels, the RFS Reform Act actually guts the RFS by eliminating key provisions that require oil companies to actually change their behavior and buy renewable fuels. It is not a coincidence that the American Petroleum Institute (API) has been asking for these modifications to the RFS for years. But the RFS Reform Act is even more disingenuous than that. While stating that he merely wants ethanol to compete in a free market, in the same breath Congressman Goodlatte proposes to ban ethanol from 90 percent of the market. If there ever was a definition of free market fit for the oil industry, this is it. It is doubtful that the sponsors of this legislation truly believe that the best way to promote second generation biofuel is to kill first generation biofuel and provide Congressional protections for the oil industry’s monopoly over the fuel blend in the process. This is just a smokescreen for going after the one alternative fuel and the one policy that has fundamentally disrupted oil industry control of the marketplace while saving consumers money at the pump.”




Edited by Rich Steeves


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