WASHINGTON, July 23, 2015 – Lawmakers and several witnesses argued today that it may be time to consider adjustments to the Renewable Fuel Standard, the cornerstone policy of the renewable fuels industry and the burr under the saddle of oil companies for the past decade.
At a joint hearing of House Science, Space and Technology subcommittees on energy and on oversight, Republican lawmakers called for change in the standard, saying the program has not accomplished desired tasks. Originally established in 2005, the RFS was designed to increase domestic biofuel production by mandating Required Volume Obligations (RVOs), or mandatory blending requirements of biofuels and gasoline. In his opening statement, Randy Weber, R-Tex., chair of the energy subcommittee, said approaching innovation via a federal mandate is “the wrong approach,” as evidenced in the RFS.
“The RFS shows that the federal government cannot use mandates to create a functional industry out of thin air,” Weber said. “Production of renewable fuels has increased, but demand for fuels with higher blends of ethanol simply does not exist, even in the most favorable market conditions.”
Oversight subcommittee chair Barry Loudermilk, R-Ga, said the RFS is forcing undesired fuels into the marketplace, and that government “has no business mandating the sales of fuels that many Americans don’t want to buy,” arguing that consumers aren’t interested in purchasing ethanol blends higher than 10 percent.
“It’s time for Congress to make a change,” he said in his opening statement. “When existing law is unworkable, Congress must listen to stakeholders, and adjust the law as it is needed.”
Both Republicans and Democrats agreed that the biofuel industry needed to diversify and focus more on fuels like cellulosic ethanol and away from reliance upon corn ethanol. At the hearing, University of Minnesota Associate Professor Jason Hill presented findings showing the life-cycle environmental impact of corn ethanol and said “the only thing green about (corn ethanol) is the plant that it comes from.”
Energy subcommittee ranking member Alan Grayson, D-Fla., pointed out that an equivalent policy to the RFS exists in Brazil, where all fuel is blended to be 25 percent ethanol. And he argued that boats, motorcycles and older vehicles seem to be operating well in that country, refuting claims from sine industries that higher blends are damaging to engines.
Renewable energy advocates expressed their disappointment at the markup’s witness panel, claiming it was stacked with RFS critics. In a statement, Growth Energy CEO Tom Buis said the exclusion of a biofuels stakeholder – aside from Chuck Red of Applied Research Associates, a drop-in biofuels company – was “unacceptable,” and “defeats the very purpose of what this congressional committee is tasked to accomplish.”
“Inviting only vocal critics of the RFS and refusing to invite a single producer or stakeholder in the ethanol industry to testify fails to provide this committee with the appropriate and necessary information to make decisions backed by facts and data,” Buis said. “If this is not a classic example of political theater, I don’t know what is.”
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