U.S. says biofuels program not expected to meet targeted emissions cuts

Source: By Chris Prentice, Reuters • Posted: Tuesday, November 29, 2016

The U.S. biofuels program, designed to boost demand for renewables in gasoline and diesel, is unlikely to meet its targets for cutting greenhouse gas emissions, the government said in two reports on Monday.

The Renewable Fuel Standard (RFS), the more than decade-old biofuels policy, is unlikely to meet targeted cuts to emissions by 2022 as production of second-generation renewable fuels lags, the Government Accountability Office (GAO) said in a report on Monday. This is likely to fuel criticism from opponents of the program that range from Big Oil companies to environmentalists.

That is largely thanks to sluggish development of the advanced fuels – including cellulosic ethanol which is produced from plant waste – that were meant to represent an increasing share of annual requirements, the GAO said. The Environmental Protection Agency (EPA) each year sets targets for the volumes of ethanol and biodiesel required to be blended with petroleum-based fuels.

The RFS program was signed into law in 2005 in a bid to reduce dependence on foreign oil, cut greenhouse gas emissions and promote rural economies. It has been stymied by regulatory delays and an earlier-than-expected drop in transportation fuel demand.

The reviews were requested by Republican Senator James Lankford of Oklahoma, a long-time opponent of the program, in 2015, a GAO spokesman said. Their publication comes the week after the EPA set biofuels targets for 2017 and biodiesel targets for 2018 that met or exceeded the congressional targets for most fuel categories.

Investment in the advanced fuel sector slowed as a result. That sector is unlikely to grow quickly enough to meet the annual production targets in the near-term, the GAO said in a second report published on Monday.

Slow development of advanced fuels with fewer emissions has become one of the key criticisms of the program from environmentalists, who question the benefits of ethanol, a renewable made from corn that represents the bulk of U.S. biofuels production.

The EPA in letters to the GAO agreed the program is unlikely to meet its targets.

The “slower-than-anticipated pace of progress (of the advanced fuel sector) means that Congress’s original goals for the program will not be met on the statutory timeline,” Janet McCabe, Acting Assistant Administrator for the Office of Air and Radiation at the EPA, said in a Nov. 16 letter published with the reports.

Still, McCabe defended the progress the agency has made and the development of other advanced fuels like biodiesel. A spokeswoman for the agency declined to comment further.

(Reporting by Chris Prentice; editing by Diane Craft)