E15 attack renews PR feud between fuel industry’s ‘Hatfields and McCoys’

Source: Amanda Peterka, E&E reporter • Posted: Friday, May 25, 2012

The biofuels industry promised a swift response yesterday to petroleum producers’ attack on E15.

Tom Buis, CEO of ethanol trade group Growth Energy, said his industry would not let the debate over E15 to get away from it as the “food versus fuel” argument did a few years ago.

The final straw on E15, he said, was the oil industry’s promotion of a report showing E15 — gasoline blended with 15 percent ethanol — damaged car engines.

“If you go back a few years ago, one of the real critical components that our industry neglected to do was to push hard back on that bogus argument of food versus fuel. And it stuck,” Buis said. “And we’re not going to allow people to go out there with misinformation at a critical juncture.”

Buis called the report released last week by the oil-industry-funded Coordinating Research Council “scare tactics.” The study showed two popular car-engine models failed when run on E15 (Greenwire, May 16).

U.S. EPA has moved in recent years to open the U.S. fuel market to E15, approving it for use in cars from model year 2001 and newer. It recently approved the first registrations for ethanol producers that want to make the fuel blend.

The oil and auto industries have pushed back at every step, arguing the fuel would damage car engines and warning that widespread “misfueling” would occur by vehicles not approved for E15.

The industries pointed to the test released last week as “material evidence” that proves that their concerns about E15, and by extension the renewable fuel standard, have been legitimate.

“The results of just-completed engine testing of E15 by the Coordinating Research Council confirm that EPA did not perform due diligence and moved too quickly in its E15 vetting process,” said Jack Gerard, president and CEO of the American Petroleum Institute. “The tests provide strong evidence E15 could damage the engines of many cars and light trucks.”

But Buis said the petroleum industry was cherry-picking studies to discredit ethanol.

“If they’re going to go out there with these scare tactics, we’re not going to sit back and allow them to get away with it anymore,” he said. “That happened before, it hurt the industry, and it’s taken a long time to dig out.”

The back-and-forth between the ethanol and oil industries is nothing new. More ethanol used in the American fuel supply means less oil, and vice versa.

“The oil industry and ethanol industry are the Hatfields and McCoys of the liquid-fuels world,” said Paul Bledsoe, a senior adviser at the Bipartisan Policy Center. “They have had this feud since ethanol first appeared. So this is just the latest skirmish.”

Changing debate

The ethanol industry, Bledsoe said, fears it is losing big political battles after a big win in 2007 with passage of the renewable fuel standard mandating U.S. production of 36 billion gallons of biofuels a year by 2022.

Attitude toward the RFS and corn ethanol has soured on Capitol Hill, and last year, though willingly at the end, the industry lost its blenders tax credit.

High corn prices and concerns about indirect land-use changes have helped feed unfavorable opinions about ethanol, said Harry de Gorter, an economist at Cornell University.

Policymakers went from “swinging from pro biofuels or indifferent to ‘Holy cow, it’s not that great,'” he said.

At the same time, the oil industry has been riding a crest from increased domestic production and new production.

“It’s an interesting dynamic,” Bledsoe said. “That is to say, that sort of relative decline in the fortunes of ethanol in recent years and relative increase in oil industry’s.”

With the pressure coming from all sides, E15 has become the tipping point for the ethanol industry, he said.

But Wally Tyner, an energy economist at Purdue University, said the ethanol industry has always been aggressive in “countering anything not supportive of their positions.” While there may be more noise now, the ethanol industry did push back against the food-versus-fuel argument, or the debate over whether corn for ethanol was driving up food prices and taking over land previously used for food production.

One thing that has changed over the last several years is the number of groups involved in Capitol Hill debates.

“They’re more spread out,” Tyner said. “You used to just have the Renewable Fuels Association, and then Growth Energy came on, and the American Coalition for Ethanol, and National Corn Growers — you’ve got all these different groups. They try to work together, but they have a little bit different agendas.”

But the groups agree on one point: They all want E15 to succeed to expand the market for traditional ethanol and also for emerging cellulosic ethanol. Buis vowed to not make the study released last week “a defining moment” in the minds of either policymakers or the public.

He called its release a calculated PR move by the oil industry, noting that preliminary results were circulated a week before the U.S. Court of Appeals in the District of Columbia Circuit heard arguments on the industry’s challenge against EPA over its approval of E15.

But despite all the bickering inside the Beltway between the ethanol and oil industries, Tyner said the public is still not fully aware of E10 — ethanol blended with 10 percent gasoline — much less E15.

“It has not hit the radar screen,” he said.