US ethanol group criticises latest biofuels study from oil group

08 August 2012 22:35  [Source: ICIS news]

HOUSTON (ICIS)--The Advanced Ethanol Council (AEC) and the Renewable Fuels Association (RFA) on Wednesday have come out against a recent analysis on the Renewable Fuel Standard (RFS) released by the American Petroleum Institute (API) earlier in the day.

The API’s 15-page analysis released this morning suggested that the RFS is not working and must be revamped.

The RFS requires 13.2bn gal (50.0bn litres) of corn-based ethanol to be produced in 2012 and 13.8bn gal in 2013.

In a conference call to discuss the report this morning, the API addressed key issues, such as problems with automobiles using ethanol blends of 15% (E15), fraudulent biofuel credits and the lack of cellulosic biofuels production.

“To increase the amount of biofuels blended in gasoline, EPA has approved the sale of E15 for a portion of the nation’s vehicle fleet,” API downstream group director Robert Greco said. “It approved E15, even though it knew or should have known of the existence of compatibility problems and even though it knew engine testing was ongoing.” 

Greco added that the Environmental Protection Agency (EPA) has still not resolved the problem of fraudulent renewable fuel credits purchased by some refiners. Those credits are called Renewable Identification Numbers (RINs).

“Finally, EPA continues the bizarre requirement that refiners blend cellulosic ethanol into gasoline, even though no one is producing any for commercial use,” said Greco.

“Nevertheless, EPA has ruled that refiners must purchase credits for this non-existent fuel. Requiring refiners to pay for a fuel that doesn’t exist is regulatory absurdity. It drives up costs and does nothing to increase use of biofuels. It may even undermine public confidence in the RFS programme itself," he said.

However, the AEC and RFA disagree.

"API has it backwards,” said Brooke Coleman, executive director of the AEC. “The problem is our dependence on foreign oil, which in turn costs consumers billions of dollars and comes at great cost to the economy and the environment. “

Coleman said the RFS, which drives American-made fuel into the marketplace, is part of the solution. 

“It should come as no surprise that the oil industry prefers to maintain its stranglehold on American consumers and sees the RFS as a threat to that dynamic,” said Colman. “This so-called report is just a basic regurgitation of the well-worn talking points API has used for years to try to weaken a landmark piece of legislation that threatens to bring consumer choice to the gas pump.”

Geoff Cooper, RFA vice president for research and analysis agreed that the API report was just another tactic in the campaign being mounted and funded by the petroleum industry to seek congressional repeal of the RFS. 

“While the drought has allowed the livestock community to take a prominent role in denouncing domestic ethanol production, many petroleum interests are still committed to seeking an end to America’s use of renewable fuels," Cooper said.  “The RFS has been the most successful energy initiative ever under taken to directly replace fossil fuels in Americans’ gas tanks.”

By: Brian Balboa
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