Comment: Obama administration is no friend to renewable fuels

Source: By Paul Alexander, The Hill • Posted: Friday, November 6, 2015

“America is on the verge of technological breakthroughs that will enable us to live our lives less dependent on oil. And these technologies will help us be better stewards of the environment, and they will help us to confront the serious challenge of global climate change.”

That proclamation, contained in a State of the Union Address, was delivered not by Barack Obama but George W. Bush. It was used to justify strengthening the Energy Policy Act of 2005 to become the Energy Independence and Security Act of 2007. “The bill…takes a significant step because it will require fuel producers to use at least 36 billion gallons of biofuel in 2022,” Bush said when he signed the bill. “It will help us diversify our energy supplies and reduce our dependence on oil.”

What the legislation created was the Renewable Fuel Standard, which required oil companies to blend minimum amounts of biofuel — mostly ethanol, which is normally derived from corn — into the national fuel supply. The amount of biofuel would increase each year until 36 billion gallons would be used in 2022.

As a candidate in 2008, Obama embraced the RFS. “Obama understands firsthand,” his website stated, “the importance of continuing to increase the supply of biofuels in our national fuel supply.” In his first term, he remained sympathetic to the RFS, so much so that as he ran for re-election in 2012 he was targeted by Big Oil. In April alone, according to Bloomberg, of the 16,991 negative ads run against Obama 81 percent came from the oil industry.

Obama supported the RFS because it worked. In its first five years, the RFS accounted for billions of gallons of biofuel being blended into the national fuel supply, lessening the country’s dependence on oil and reducing air pollution and greenhouse gas emissions, the main cause of climate change. In addition, countless jobs were created, especially in Midwestern states where corn is grown.

But in the latter part of 2012, everything changed. Reuters later reported that around this time Rep. Robert Brady (D-Pa.) lobbied Vice President Joe Biden on behalf of the Carlyle Group, the owner of two struggling oil refineries near Philadelphia. Carlyle was concerned about the skyrocketing price of RINs, credits purchased by oil refineries that choose not to comply with RFS regulations. Biden told Brady that “we’ve got to try to fix that.” Biden’s fix? Modify the RFS.

The first indication the RFS would be weakened came in November 2013 when the Obama administration revealed a new methodology for the RFS that could, if carried out, allow the oil industry to escape its legal obligation to dispense renewable fuels. Then new regulations were announced in May 2015 with the final approval to come on November 30. The revised regulations require 16.3 billion gallons of biofuel to be blended in 2015, down four billion from the original legislation, and 17.4 billion gallons in 2016, down five billion. This means Bush’s goal of reaching 36 billion gallons by 2022 will not be met.

Why was the RFS weakened? It’s not clear. However, one development has surfaced. Key advisors involved in modifying the RFS have left the administration to accept positions affiliated with Big Oil. James Stock, a member of the Council of Economic Advisors, played an important role in reshaping the RFS; he left the administration to became a fellow at the Center for Global Energy Policy, which receives funding from ExxonMobil and has advisory board members associated with major oil companies, and the National Bureau of Economic Research, which receives funding from Shell and ExxonMobil. Bob Perciasepe, a deputy administrator at the Environmental Protection Agency who met with biofuel industry leaders as the RFS was being modified, left to become president of the Center for Climate and Energy Solutions, which counts among its funders BP, Shell, and ConocoPhillips. Heather Zichal, who met with oil refiners and their lobbyists in the White House concerning the RFS, gave up her title of Deputy Assistant to the president to join the board of Cheniere Energy and to accept a position as fellow at the Atlantic Council, which receives funding from a host of oil companies, among them Occidental Petroleum, Pioneer, and ConocoPhillips.

Then again, officials throughout the Obama administration have left government to work for Big Oil. Ken Salazar, Secretary of the Interior under Obama, works for WilmerHale, a law firm whose website touts the firm’s representation of oil and gas clients. Daniel Poneman, Deputy Secretary of Energy under Obama, is CEO of Centrus Energy. General James Jones, National Security Advisor under Obama, left to become the top lobbyist for the American Petroleum Institute.

As he enters his last year in office, Obama has made climate change a legacy issue. It’s ironic, then, that part of his legacy will be his decision to gut the RFS, legislation — signed by Bush, the darling of Big Oil — that has proven effective in combating climate change by reducing both oil consumption and greenhouse gas emissions.

Alexander is a journalist, playwright and documentarian.