Governors' Biofuels Coalition

Pruitt and Agriculture Secretary Sonny Perdue will meet with Trump today to present a package of changes to the Renewable Fuel Standard to end tensions over the program between corn farmers and refiners. The two men will propose capping the price of biofuel credits (called Renewable Identification Numbers), a year-round waiver for the sale of 15 percent ethanol gasoline, the creation of credits for exported ethanol, and a transparency measure intended to cut Wall Street investors out of trading in the program. All of the proposals would be executed administratively, rather than legislatively. The pitch to Trump precedes a Tuesday meeting between the president and Sen. Chuck Grassley, Joni Ernst, Ted Cruz and Pat Toomey.

Basically the Cruz proposal: Cruz has been proposing the waiver-for-RIN-cap package for months now and getting nowhere with corn-staters. The addition of allowing credits for exports, which Pruitt floated and abandoned last year after an uproar from Gang Grain, seems unlikely to add to its appeal, though ethanol producers have expressed openness to the transparency measure. A refining source says the legal authority for some of these measures is “highly doubtful, but by the time the rule is final and then litigated, authors will be long gone from the scene. Think at least 2-2.5 years. God only knows what gyrations the market will endure in the interim.”

Independent refiners are in: Another source says the proposals “would result in more predictability in the RINs market and in expanded biofuels sales and higher blends. That’s the sort of win-win Cruz and Toomey seem to have been referring to. And this process seems not to require legislative action, therefore ensuring faster results.”

Catching the president’s eye: Ahead of the Tuesday meeting, Fuels America will launch a TV ad on “Fox & Friends” in the D.C. market starting today through Tuesday. The ad thanks Trump for his commitment to the RFS. Watch it here.

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