Court rejects livestock industry challenge over EPA fuel regs

Source: Amanda Peterka, E&E reporter • Posted: Monday, July 23, 2012

A federal appeals court has rejected a challenge by livestock industries over U.S. EPA’s regulations exempting older ethanol plants from demonstrating that the fuel they produce results in lower greenhouse gas emissions compared to fossil fuels.

In its decision, the U.S. Court of Appeals for the District of Columbia Circuit ruled that the petitioners did not have sufficient standing to bring the challenge.

The National Chicken Council, National Meat Association and National Turkey Federation filed the petition in May 2010, protesting a rule by EPA that indefinitely exempted ethanol plants built in 2008 and 2009 from the greenhouse gas emission reduction requirement.

Plants built after 2009 must demonstrate that their product reduces emissions by 20 percent compared to fossil fuels in order to participate in EPA’s renewable fuel credit trading system, which was established in 2007 under the Energy Independence and Security Act.

The livestock groups had said in oral arguments Feb. 13 that the exemption increases ethanol production, which in turn increases the price of corn-based livestock feed. Eliminating the grandfathering clause, they said, would reduce ethanol production and address their injury.

“We now find the petitioners have fallen short” of demonstrating standing, the three-judge panel ruled. “The petitioners fail to show a ‘substantial probability’ that qualifying ethanol plants would reduce their ethanol production as a result of that change.”

If the EPA rule were vacated, the court said, the only consequence would be that the ethanol plants would no longer be able to participate in the credit-trading program unless they reduced their emissions. The court said there was no guarantee that the plants would be forced to shut down or reduce corn demand.

Tom Super, a spokesman for the National Chicken Council, said industry groups were “disappointed” by the court ruling, but added, “We are heartened by the Court’s concluding point that the merits of this questionable regulation remain open to challenge.”

The finding comes a day after several livestock trade groups, including all the petitioners, released a study showing that the price of corn has driven up feed prices. They blamed federal mandates requiring the production of corn ethanol (E&ENews PM, July 19).

The petitioners are also among a group of livestock, oil and auto trade groups suing EPA over its decision to expand the amount of ethanol allowed in gasoline from 10 percent to 15 percent. A ruling on that case is expected any day now.