Ethanol mandate: Going up?

Source: By Laura Barron-Lopez, The • Posted: Friday, July 25, 2014

White House adviser John Podesta has indicated the administration plans to raise the amount of ethanol and other biofuels that must be blended into the nation’s fuel supply, Sen. Al Franken (D-Minn.) said Thursday.

The Environmental Protection Agency’s proposed draft on blending volumes, which was released late last year, cut the amount of biofuels that refiners would need to mix into their fuels. The plan represented the first time the agency had lowered the target from the previous year.

While the primary focus of Thursday’s meeting between Podesta and Senate Democrats was on biodiesel volumes, Franken said the adviser mentioned that the final blending mandates would likely be higher than what the EPA had initially proposed.

“I believe the numbers will be bigger and that’s based not only on conversations with [Podesta] but my conversations with EPA Administrator Gina McCarthy,” Franken said. “He certainly led us to believe there will be higher numbers in each piece of it than was in the preliminary [Renewable Fuel Standard].”

Franken said Podesta told the senators that the release of the final rule “will be imminent.”

“We were all making the case that the preliminary RFS rule put out by the EPA is unacceptable,” Franken said on a call with reporters after the meeting with Podesta.

A main point of contention is the biodiesel levels set in the EPA’s proposal. The EPA kept 2013 levels in place for the biodiesel blend requirement, but senators like Franken, Sen. Heidi Heitkamp (D-N.D.) and Sen. Sheldon Whitehouse (D-R.I.) want the threshold to be raised.

The agency set biodiesel at 1.28 billion gallons, but the industry and lawmakers want the EPA to set the blend volume at 1.8 billion gallons in the final 2014 rule.

Franken argued that setting the blending threshold too low would discourage investments and put biodiesel producers out of business.

The proposed draft for the 2014 renewable fuel mandate was considered a victory for oil companies, who cheered the retreat in blending volumes.

If the EPA does increase levels in the final rule, they will likely face severe pushback from the oil industry, which argues increasing amounts of biofuels mixed into the fuel supply damage cars, engines, and more.”Speculation doesn’t help protect consumers against unsafe requirements for ethanol in gasoline,” said American Petroleum Institute spokesman Carlton Carroll. “There’s a growing consensus among members of Congress and consumer, food, and industry groups that the RFS is unworkable and needs to be fixed as soon as possible.”