Op-Ed: Endless assault on the RFS

Source: By Doug Durante, The Hill • Posted: Friday, March 11, 2016

With regard to the recent opinion expressed by Rob Green of the National Council of Chain Restaurants, all I can say is gosh, what a better source for an objective assessment of the RFS than the restaurant industry.  They lead a parade of poultry, beef, and pork producers who demand  cheap grain to ensure their profit margins remain high.  But in this case, it is hard to figure why these folks are so mad. They have cheap grain, and can in part thank ethanol.

The endless, numbing assault on ethanol and the renewable fuel standard has even us supporters suffering biofuel fatigue.  We are exhausted from correcting the lies and misinformation opponents continue to circulate to serve their own purposes. The author dredges up the high corn price nonsense coupled with an absurd claim that 40 percent of the corn crop is used for ethanol.

First of all, the price of corn today is lower than the price of corn before the current RFS took effect.  At around $3.50 per bushel, the RFS has brought prices down by creating more supply and increased efficiency.  As for the claim that 40 percent of the crop is “diverted” is not just flat out wrong but it is intellectually dishonest.   Half of that total is returned to the feed market as high protein distillers grains after the starch is converted to ethanol.

A study he cites looked at corn costs only up to 2011—cherry picking a couple of years when prices went through the roof due to rampant speculation and skyrocketing oil prices.  Corn prices quickly stabilized and have remained so. A more accurate picture emerges from the world food price index which is at its lowest since 2009.  The United Nations’ Food and Agriculture Organization reports world food prices are at a seven year low and  2015 saw a whopping 19 percent drop in prices.  This, as reported in the Economic Times last week– hardly a front for the ethanol industry. More than 80 percent of the food dollar goes to transport, processing, packaging and retail, with energy costs front and center.  Opponents of ethanol have a right to free speech but they don’t get to just make things up.

I was at the hearing in the Senate Green mentions and wanted to scream, but for a different reason. Like Green,  most of the senators don’t understand the RFS and what it actually is–and isn’t.  It is a requirement that the petroleum industry, a monopoly born of tax breaks and favored treatment for 100 years, start cleaning up their act by offering renewable energy to consumers to offset the largely imported, job killing, and poisonous fuels they force on us.  What it is not is an ethanol mandate. There is no requirement whatsoever to use ethanol, much less corn ethanol.   The intent of the law was that they would use some of their obscene profits to develop next generation fuels and open the market for their use.  They have done neither.

The real rub here is Green’s suggestion that it is “odd” that EPA implements this program.  Again, for anyone who knows anything about the program you would know it is part of the Clean Air Act. Ethanol, biodiesel, and even the drop-in fuels are inherently cleaner and healthier than petroleum products.  Consumer gasoline is a pollution soup that emits known and suspected carcinogens and needs to be cleaned up–period. Toxic compounds refined for octane produce ultra fine particulates and groups like the Urban Air Initiative are increasingly linking these emissions to respiratory and even neurological disease.  As the next generation of automobiles will need higher octane fuels to meet carbon and mileage requirements, the last place we want that octane to come from is the oil barrel.

We have a cleaner, cheaper, better fuel and we just want to be able to compete. If EPA opened the doors to the market with some simple steps then you would see alternatives like ethanol competing even without an RFS.  We would have a true free market these folks all hide behind and the RFS wouldn’t  be such a source of angst.  That hearing should have been a concerted effort to make the program work but instead was another disaster of misinformation.

The restaurant industry should be applauding ethanol–healthier people who have more money in their pockets from fuel and health care savings will live longer and can go to their restaurants even more!

Durante is executive director of the Clean Fuels Development Coalition.