The EPA Announced New Requirements For Biofuels, And Basically Everyone Is Unhappy

05/29/2015 03:32 pm ET | Updated May 29, 2015

WASHINGTON -- The Environmental Protection Agency on Friday proposed new volume requirements for biofuels, to a chorus of complaints from all sides.

Under the Renewable Fuel Standard, refiners are expected to include a certain amount of biofuels in gasoline and diesel fuels. The EPA's blend proposal gradually increases the gallons required, but not as dramatically as the 2007 Energy Independence & Security Act had originally envisioned for the renewable fuel standard.

The proposed requirements cover the years 2014, 2015 and 2016. (The requirements for 2014 are retroactive, reflecting the amounts actually used that year, since the proposed amounts had been repeatedly delayed.) Going forward, the proposal would increase the required amount of cellulosic biofuels -- fuels produced from wood, grasses or waste portions of plants -- from 33 million gallons used in 2014 to 106 million by 2015 and 206 million gallons by 2016. The required amount of advanced biofuels would go up to more than 3.40 billion gallons for 2016, a 27 percent increase from the amount used in 2014. The proposal would also increase the amount of conventional ethanol, or biofuel derived from corn, from 13.25 billion gallons used last year to 13.4 billion required in 2015 and 14 billion in 2016.

Janet McCabe, the EPA's acting assistant administrator for the Office of Air and Radiation, said in a call with reporters Friday morning that the proposal sets blend volumes at an "ambitious but responsible rate," and noted that the agency "recognize[s] the successes of the program so far … but also must recognize real-world limitations to growth in the near future."

"EPA is committed to implementing the Renewable Fuel Standard in a way that responsibly pushes forward and grows the use of biofuels over time," said McCabe.

But the changes aren't enough to satisfy critics of the RFS, which include a wide range of both environmental and conservative groups. Groups like the Environmental Working Group have criticized the requirements for continuing to increase the use of corn ethanol, which the group argues actually increases lifecycle greenhouse gas emissions. Increasing the ethanol blend, said Emily Cassidy, a research analyst at EWG, "increases greenhouse gas emissions at a time when we really need to drastically curb carbon emissions."

Environmental groups are comparatively more open to increased use of cellulosic and advanced biofuels, which have been found to have lower greenhouse gas emissions. But the growth of those next-generation biofuels has been slow.

Conservative groups like the Competitive Enterprise Institute argued that the biofuels mandate exceeds consumer demand, and also criticized the EPA for delivering its 2014 standard after the year had actually passed. "Instead of building a predictable market, the RFS has ushered in a reign of regulatory uncertainty," said CEI senior fellow Marlo Lewis. "Another testament to the folly of centralized planning."

The oil industry's leading lobby, the American Petroleum Institute, wants the RFS repealed outright. "Consumers’ interest should come ahead of ethanol interests," API President and CEO Jack Gerard said in a statement. "EPA assumes growing demand for high-ethanol fuel blends that are not compatible with most cars on the road today, potentially putting American consumers, their vehicles and our economy at risk."

Friday's announcement also renewed calls from some in Congress to reform the RFS or toss it out entirely. Sen. Jim Inhofe (R-Okla.) said that the volumes in the proposal are "unachievable." Sen. David Vitter (R-La.) called them "unrealistic."

Nor did the EPA's announcement please the corn industry. “Once again, the EPA has chosen to ignore the law by cutting the corn ethanol obligation 3.75 billion gallons from 2014 to 2016. This represents nearly a billion and a half bushels in lost corn demand," said Chip Bowling, president of the National Corn Growers Association, referring to the levels specified in the Energy Independence & Security Act. "The only beneficiary of the EPA’s decision is Big Oil, which has continuously sought to undermine the development of clean, renewable fuels. Unfortunately, the EPA’s gift to Big Oil comes at the expense of family farmers, American consumers and the air we breathe."

The Advanced Ethanol Council's Executive Director Brooke Coleman criticized the rules for not going far enough to promote alternate biofuels. "The blending targets are definitely stronger and theoretically create new markets," she said in a statement, but accused the EPA of "allowing the oil industry’s refusal to comply with the RFS to be cause to slow the program down."

Even senators who praised the release of the new blend standards were critical of EPA's delay in updating them. Sen. Heidi Heitkamp (D-N.D.) said in a statement that a "true all-of-the-above energy strategy has to include biofuels," but complained that "the EPA hasn’t been doing its part and it took far too long for the agency to issue these updated levels."

"It’s a positive step that EPA today released biodiesel and ethanol target levels to get back on track and give producers needed certainty, but the levels set are below the levels that Congress laid out that our workers need," she said.

The open comment period for the proposal will last through July 27, and final standards will be issued by Nov. 30, the EPA said.

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