EPA Defends Controversial Biofuels Program at Senate Hearing

Source: By Reuters • Posted: Friday, June 19, 2015

WASHINGTON — The U.S. environmental regulator on Thursday defended its handling of the nation’s controversial renewable fuels program at a congressional hearing, the first since its new biofuels targets last month provoked a furor among corn farmers and oil refiners.

At the hearing by the Senate subcommittee on regulatory affairs and federal management, U.S. lawmakers criticized the agency for years-long delays to quotas and for last month setting unattainable targets for the amount of corn-based ethanol and other biofuels that must be used in the nation’s motor fuel supply over the next two years.

They also questioned the future of the decade-old Renewable Fuels Standards (RFS), which critics say has inflated prices of food and fuel at the pump.

The panel will likely increase congressional attention to the pitfalls of the decade-old biofuels policy as it faces a fresh wave of criticism from policymakers, the oil industry and environmentalists.

But many experts say a major legislative overhaul, which would need approval in Congress, is unlikely with an election less than two years away.

While acknowledging delays created uncertainty in the ethanol market, Acting Assistant Administrator Janet McCabe reaffirmed the agency’s stance that the new targets sought to ensure growth of the U.S. renewable fuel industry while also going some way toward meeting goals set by Congress in 2007.

She told the panel the latest targets are “ambitious but responsible,” the EPA’s first public comments since unveiling long-awaited targets late last month.

Still, the EPA is already looking at the possibility it will need to reset biofuels use targets in 2017 and beyond, McCabe said.

At the hearing, James Lankford, a Republican Senator and the subcommittee chairman, attacked the RFS for artificially pushing corn-based ethanol into the motor fuel stream without environmental benefits.

“We must ask ourselves if the RFS goals of yesterday are worth the increased costs to our food, gas and the environment,” said the senator from Oklahoma, an oil-rich state, in opening remarks.

Introduced in 2005 and a pillar of two presidential administrations, the RFS was aimed at cutting America’s dependence on foreign oil and shift the nation to cleaner energy sources.

Supporters refute claims that the policy increases costs and the EPA said last week it sees no net increase in fuel prices from the program.

Oil companies including Tesoro Corp have threatened legal action to fight the latest proposal, while corn-based ethanol producers, like Archer Daniels Midland Co, say the rules don’t go far enough.