Oil industry re-ups its bid to repeal the nation’s ‘broken’ ethanol mandate

Source: By John Siciliano and Josh Siegel, Washington Examiner • Posted: Friday, August 17, 2018

The American Petroleum Institute on Thursday re-upped its near-decade-long bid to repeal the nation’s ethanol mandate.

A broken system: The Renewable Fuel Standard “mandate is broken and needs to be repealed or significantly reformed,” said Frank Macchiarola, API’s downstream director, outlining the group’s comments it will be filing with the Environmental Protection Agency on the 2019 biofuel blending standards ahead of Friday’s deadline.

Not going quietly into the sunset: Macchiarola said he is open to reforming the EPA biofuel program, but what he means by “reform” is legislation to sunset the program in 2022.

API is open to a deal with the ethanol industry, he said on a Thursday call with reporters. The group is willing to support selling higher 15-percent blends of ethanol in gasoline year round, which the ethanol producers want, but only if the ethanol industry goes along with sunsetting the program.

What’s cooking on Capitol Hill: There is both legislation in the House and Senate being drafted to reform the program, but it is unlikely that such a bill would be debated and passed in a year dominated by the midterm elections.

Other criticisms the oil industry will lay out in its comments include: The Renewable Fuel Standard has failed to lower greenhouse gas emissions blamed for causing climate change. The program was meant to lead to billions upon billions of gallons of advanced “cellulosic” fuels by now, but such robust production “has not come to fruition,” Macchiarola said.

The fuels are supposed to transition the mandate toward lower-emission fuels derived from waste, and not crops like corn. This would, in turn, lead to less production of carbon dioxide emissions and move the program closer to its goal of blending 36 billion gallons of biofuel into the nation’s fuel supply by 2022.

More ethanol equals more harm to vehicles: API will also argue that increasing the amount of ethanol in the gasoline supply to meet the 2022 goal would harm vehicle engines and lead to “costly repairs,” said Macchiarola.

The oil group wants EPA to cut the amount of fuel it requires refineries to blend next year to ensure against these problems.