WASHINGTON, July 1, 2015 – EPA traveled to the heart of corn country last week to gauge public sentiment on its recently announced plan for Renewable Fuel Standard volume requirements through 2016. Agency officials certainly got an earful.
About 270 witnesses showed up in Kansas City, Kansas, to share their opinions on the EPA proposal, which covers blending requirements for 2014, 2015 and 2016. The plan would increase the amount of biofuels required for blending into gasoline – including corn-based ethanol – but falls short of the levels called for by the laws governing the RFS.
As the hearing began, Chris Grundler, director of EPA’s Office of Transportation and Air Quality, said the agency needed to set the volume requirements below statutory levels because those levels “cannot be achieved.” He said setting the levels at the standards called by statute and then hoping that would drive investment and increased production would be “irresponsible and would have significant negative impacts including widespread non-compliance.”
Political officials from the region weighed in at the hearing including the governors of two neighboring states. In his testimony, Iowa Governor Terry Branstad said EPA seems to have bought the “blend wall” argument – a perceived cap on the amount of ethanol the marketplace can handle – “hook, line, and sinker.”
“The EPA has a choice: protect the deep pockets of Big Oil and their monopolistic practices . . . or they can nurture consumer choice, renewable energy growth, and a healthy rural economy,” Branstad said. “My hope is that the EPA is open to improving the proposal much further and meeting the original congressional intent of significantly expanding the use of biofuels.”
Jay Nixon, the governor of Missouri, said EPA is stopping just short of meeting the standard, and “you don’t stop plowing 80 percent through the field.”
“It is counterintuitive for the agency that is charged with enforcing the clean air laws to impose a de facto limit on ethanol, a product which so clearly emits fewer greenhouse gasses,” Nixon said. “The one agency that should be saying more is saying less.”
The EPA also heard from plenty of representatives from trade associations and private industry, most of whom wanted to see a stronger RFS: Growth Energy CEO Tom Buis channeled his inner Ronald Reagan and called on EPA to “tear down this blend wall;” Anne Steckel, National Biodiesel Board vice president of federal affairs, pointed out all the success stories of the last 10 years in the biodiesel industry and asked EPA to consider what would be possible in the next 10 years with the agency’s support; National Corn Growers Association President Chip Bowling said the proposal would hurt corn demand, and said his association “simply cannot afford – and will not tolerate – efforts to cut the demand for corn.”
Opposition to the RFS was present, but limited. Of those who did speak against the RFS, many were thankful that EPA opted to use waiver authority to propose levels below statutory requirements. Bob Anderson with Chevron USA said E85 – gasoline blended with 85 percent ethanol -- likely isn’t the way to break through the blend wall because retailers have found it to be “challenging at best.” He said customer acceptance of the fuel is low due to concerns over vehicle compatibility, making it difficult to sell at retail.
The public hearing was part of a comment period that is scheduled to end – barring an extension – July 27. In accordance with a consent decree, EPA is expected to review submitted comments and finalize the proposals by Nov. 30.
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