Iowa leaders promise to fight EPA proposal that cuts ethanol

Source: Written by Donnelle Eller, Des Moines Register • Posted: Monday, November 25, 2013

The reduction would help ‘Big Oil,’ but harm Iowans, Branstad says

From left, Gov. Terry Branstad, Iowa Agriculture Secretary Bill Northey, U.S. Rep. Steve King, Lt. Gov. Kim Reynolds and U.S. Sen. Chuck Grassley visit Lincolnway Energy to speak out against an EPA proposal. / Andrea Melendez/The Register

NEVADA, IA. — Economic vitality, energy independence and investment in next-generation renewable fuels all are at risk with a federal proposal to reduce the alternative fuels that go into the U.S. fuel supply, political and industry leaders said at a rally Friday.

A week ago, the U.S. Environmental Protection Agency proposed cutting by 3 billion gallons the amount of renewable fuels that would be blended into the U.S. fuel supply next year. It included reducing corn-based ethanol use by about 1.4 billion gallons.

Gov. Terry Branstad, U.S. Rep. Steve King and U.S. Sen. Chuck Grassley vowed to fight the decision, including challenging the proposal in court, if necessary. Opponents to the proposal have 60 days to sway the EPA before the proposal becomes final

“This is critical for our state and our future,” Branstad told about 150 supporters who gathered at Lincolnway Energy, an ethanol plant near Nevada. “This is the livelihood of our people. This is the profitability of our farmers. This is quality jobs throughout our state, and it is absolutely wrong for the EPA to cave into Big Oil.”

The oil industry hailed the EPA’s decision last week, saying it acknowledged for the first time the “blend wall,” or limitations on the nation’s ability to push consumption beyond 10 percent ethanol, now used by most motorists.

Boosting the amount of ethanol used would require an increased use of higher blends such as E15. Auto manufacturers contend E15 and higher blends could damage vehicles, something the ethanol producers dispute.

Eric Hakmiller, Lincolnway Energy’s CEO, called EPA’s proposal misguided and based on old data.

Eventually, he said, the decision will affect consumers. “Now is the time to stand together and push back against Big Oil, to push back against a future that has higher gasoline prices, more foreign oil and more dependence on other countries for our energy sources,” Hakmiller said.

Branstad, Lt. Gov. Kim Reynolds and Iowa Agriculture Secretary Bill Northey said Iowa, the nation’s largest producer of renewable fuels, could see jobs cut with a lowered renewable fuels standard.

Iowa has 42 ethanol and 12 biodiesel plants. Three cellulosic plants are under construction, including a $200 million facility that DuPont has under construction next to Lincolnway Energy. The plant will use use corn stalks, cobs and other crop residue to produce ethanol.

“This industry provides good-paying and vital jobs in communities all across the state. It supports our community and rural way of life,” Branstad said. He told the crowd he invested in Lincolnway Energy before becoming the state’s governor for a second time.

DuPont executive Troy Wilson said EPA’s pull-back makes it “much more difficult for investors to commit dollars for the second wave” of cellulosic ethanol plants.

Grassley said supporters are “fighting ignorance” about ethanol and biodiesel. He said U.S. farmers stepped up to develop the industry when oil embargoes had the United States in a stranglehold in the 1970s. “We’re going to battle this decision,” Grassley said.