31 July 2007 23:54 [Source: ICIS news]
Charles Drevna, executive vice president at the National Petrochemical & Refiners Association (NPRA), told a Senate committee that congressional mandates for ever-increasing biobased fuel production could lead to market instability.
Testifying before a panel of the Senate Energy and Natural Resources Committee on the
A new mandate for
On the production side, Drevna said a new and massive congressional mandate for ethanol production could undermine US gasoline supplies.
He cited the Bush administration’s call for 35bn gal/year of biofuels production by 2017 as part of a plan to reduce
The Department of Energy forecasts that
“It should be clearly understood that requirements to substantially increase the volume of ethanol and other renewables could essentially supplant a significant portion of the need and desire for additional domestic refining capacity,” Drevna said.
“The domestic refining industry is likely to look upon rapidly rising ethanol and other biofuels requirements in the coming years as adding significantly more risk to investment in capacity expansions,” he said. He warned that additional congressional mandates for ethanol output will pressure domestic and foreign refiners to reconsider investments in new capacity.
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