Op-Ed: RVO Proposal Undermines Ethanol GHG-Reduction Benefits, Promise to Farmers

Source: By Ernie Shea, 25x25 • Posted: Friday, June 29, 2018

EPA’s handling of the 2019 Renewable Volume Obligations (RVOs) proposed this week under the Renewable Fuel Standard (RFS) represents the latest evidence of the Trump administration’s disregard of the warnings from a vast consensus of scientific experts concluding climate change is real, is impacting us here in the United States and around the world, and requires measures to reduce the greenhouse gas (GHGs) emissions that are forcing up the global temperatures that drive a changing climate.

Compounding the EPA RVO proposal’s error in scientific judgement is the agency’s seeming indifference to the economic struggles of rural America. Through what the proposed RVOs could ultimately deliver, EPA is pursuing a policy that deprives producers and rural communities of needed revenues at a time when the U.S. agriculture economy finds itself in the throes of a five- year, 52-percent downturn.

On Tuesday, the agency proposed a total renewable fuel volume of 19.88 billion gallons, which looks to be a 3-percent improvement over the 2018 RFS requirements. The increase comes in cellulosic biofuel (381 million gallons) and in “advanced” biofuels – including biomass-based diesel such as biodiesel made from soybeans – that can offer at least a 50-percent reduction in emissions when compared to their petroleum-based counterparts.

Of course, the largest share of the RVOs is the 15 billion gallons that would ostensibly come from conventional renewable fuels like corn ethanol. Unfortunately, EPA disclosed this week that EPA Administrator Scott Pruitt has retroactively granted nearly two dozen “hardship” waivers for 2016 and 2017 to refiners who claim that meeting the RFS biofuel-blending requirements would have imposed disproportionate economic hardships.

The number of waivers granted by Pruitt exponentially exceeds those handed out during the Obama administration. And most of the waivers granted with little, if any, transparency, are seen by Sen. Chuck Grassley to be in violation of the federal Administrative Procedure Act because EPA is failing to disclose details of the waivers with Congress, much less the public. Ethanol advocates also say the waivers fail to comply with a 2017 federal appeals court ruling in 2017 addressing the criteria for reducing RFS blending requirements below the levels set by a bipartisan vote from Congress more than a decade ago. Furthermore, it appears the EPA has been ignoring recommendations from DOE to reject or limit waivers to oil refiners seeking exemptions from the RFS.

EPA had a chance to remedy the shortcomings wrought by the waivers by inserting a provision in its RVO proposal to reallocate to other refiners some 2.25 billion gallons of ethanol lost through the waivers. But Pruitt chose to favor the oil industry and dropped the provision. Nor did the proposal for 2019 address the appellate court ruling nearly two years ago calling for the restoration of 500 million gallons of ethanol the court said the Obama administration wrongly dropped under the 2016 RFS blending mandate. Finally, the proposal fails to deliver on a promise from President Trump to lift the ban on the sale of E15 in most of the United States during summer months.

The Trump administration has made it very clear that climate change is not a policy priority. In fact, the White House has directed agencies to remove or alter any references to climate change in their public presentations like websites or position statements. This effort in policy “scrubbing” comes despite vast amounts of scientific data, including findings from federal agencies, confirming the dangerous trend.

A principal means by which the agriculture sector can help governments around the world reach global emission-reduction goals is through the production and implementation of biofuel technologies that utilize farm and forestry feedstocks. This strategy makes up one of the three pillars of climate-smart agriculture advocated by Solutions from the Land: a collection of actions that farmers can take to reduce GHG emissions and simultaneously improve profitability.

Sadly, Pruitt has left hundreds of thousands of gallons of ethanol, and the emission-reduction capability that comes with them, on the table. The transportation sector is the second-biggest source of GHGs in the world, accounting for more than one-fifth of all emissions. Yet the sector is among the slowest in reducing its emissions, due mostly to a failure to fully implement the biofuel technologies it has available – a shortfall reflected by the EPA proposal for 2019 RVOs.

Furthermore, Pruitt is reneging on the promises made by Trump to support the ethanol industry, depriving farmers and the rural communities they support of income critical to the wellbeing of U.S. agriculture. The RVO proposals will undergo a public comment period and all stakeholders are strongly urged to make their voices heard and call for a righting of this policy ship.