House Republicans ask cut in US ethanol mandate

01 July 2008 20:24  [Source: ICIS news]

WASHINGTON (ICIS news)--More than 50 House Republicans have asked regulators to cut the US corn ethanol production mandate in light of flooding in the US corn belt and related pricing pressure on grains, according to a letter circulated on Tuesday.

 

The House members, led by Robert Goodlatte of Virginia and Joe Barton of Texas, urged the Environmental Protection Agency (EPA) to reduce the amount of ethanol that must be blended into US gasoline supplies because of widespread flood damage to corn crops in the US midwest.

 

“Severe flooding in the midwest and drought in the south have already produced devastating losses in this year’s corn crop and continued adverse weather could further decrease this year’s already depleted crop,” the members argued in their letter.

 

“We are already seeing the impact of decreased domestic corn production on prices in the US, currently holding at record highs,” the letter said. 

 

The House members charged that the federal renewable fuel standard (RFS), which mandates US biofuels production of 36bn gal/year by 2022, “is a significant factor in the increased cost of commodities and is causing severe economic harm for low income Americans and livestock producers.

 

The new renewable fuel standard, which was set by the Energy Independence and Security Act (EISA) of 2007, requires ethanol output of 9bn gal/year this year. 

 

As current US ethanol production is wholly corn based, ethanol production was expected to consume one-third of this year’s corn crop. The members of Congress contend that corn belt flooding and droughts combined with ethanol demand will mean much less of that key crop available for human food products and livestock breeders.

 

A spokeswoman for Goodlatte said the congressman and his Republican colleagues are not seeking a specific reply from EPA but wanted the agency to bear in mind the broader cost to consumers in the renewable fuel standard.

 

The agency is already considering requests by Texas Governor Rick Perry and Texas Republican Senator Kay Bailey Hutchison for sharp reduction in the ethanol mandate.

 

Goodlatte is the ranking Republican on the House Agriculture Committee, and Barton is the senior Republican member of the House Energy and Commerce Committee.

 

The Renewable Fuels Association (RFA), the US ethanol trade group, was not available for comment on Tuesday regarding the congressional request to EPA.

 

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