Petroleum group’s new video slams cellulosic mandate

Source: Amanda Peterka, E&E reporter • Posted: Wednesday, June 20, 2012

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The oil industry-backed American Energy Alliance yesterday continued its messaging war against the Obama administration’s energy policies with an online video slamming U.S. EPA production targets for cellulosic biofuels.

The “Phantom Fuels” video accuses EPA of forcing refiners to blend cellulosic biofuel that doesn’t exist and then penalizing them for failing to meet required production levels. It comes just a week after oil industry groups sued EPA to force the agency to waive its 2011 cellulosic biofuel targets for the same reason.

“Renewable mandates like the cellulosic biofuel requirements eventually defraud American consumers, who are forced to pay higher energy prices to fund the political experiments of crony capitalists,” AEA President Thomas Pyle said in a statement. “These ‘phantom fuels’ are but another example of the kind of policies that have marked the Obama-Solyndra era.”

Benjamin Cole, a spokesman for both the Institute for Energy Research and the American Energy Alliance, said yesterday that the video builds off the momentum AEA felt after launching a $3.6 million, 10-state ad campaign against President Obama’s energy policies.

The cellulosic biofuel mandate was established by Congress during the George W. Bush administration, and Cole noted that AEA felt it was a bad policy from the start. EPA’s handling of the mandate is a “good example of regulation gone rogue,” Cole said.

“It’s bad policy being applied through bad regulations,” Cole said. “We’re looking for every opportunity we can to spotlight those regulatory abuses.”

This year, EPA has required that the country blend 8.65 million gallons of cellulosic biofuel into gasoline. Alternatively, refiners can purchase renewable fuel credits to meet the requirements.

Earlier this year, oil industry groups also sued EPA over these 2012 requirements. The oil industry, livestock trade groups and environmentalists are also awaiting a ruling in their challenge to EPA’s decision to allow an increased level of ethanol in gasoline.

Ethanol trade groups throughout have urged the courts to hold strong on EPA’s actions. Companies attempting to scale up production of cellulosic biofuel have also pressed Congress to resist attempts to weaken or eliminate the renewable fuel standard.

Several companies are in the middle of building commercial-scale cellulosic plants that will open within the next couple years. Those companies include big players like DuPont Biofuels, BP Biofuels, Abengoa SA and Poet-DSM Advanced Biofuels.

They’ve maintained that the biofuels mandate has been critical in spurring investment and bridging the “valley of death,” the gap between pilot projects and commercialization.

“The likelihood of change in policy will slow down progress quite a bit,” Jan Koninckx, global business director at DuPont Biofuels, said yesterday at a forum in Washington, D.C.