16 July 2013 23:36 [Source: ICIS news]
HOUSTON (ICIS)--The current Renewable Fuel Standard (RFS) is unworkable and should be updated in order to allow ethanol to actively play a role in the US energy mix, industry officials told a US Senate panel on Tuesday.
As US refineries maintain high utilisation rates and incorporate more domestic, cheaper grades of crude oil, questions of high retail gasoline prices have come to the forefront.
During a Senate Committee on Energy and Natural Resources hearing, US refiner Valero’s CEO Bill Klesse testified about the recent high gasoline prices, saying that policies such as the RFS make it difficult to refine in the US.
“Today, the most important thing affecting us is the RFS,” he said. “Valero is the third largest corn ethanol producer, but the RFS is out of control. Renewable Identification Numbers (RINs) are going up, probably as we speak.”
The price of RINs, or the credits for biofuels that cannot safely be blended into gasoline, has hit a record high this week of $1.33 (€1.02) for advanced biofuel RINs, $1.32 for corn-based ethanol RINs and $1.33 for biomass-based diesel RINs, according to the American Fuel & Petrochemical Manufacturers (AFPM).
“We support and believe that ethanol will be part of the fuel mix in this country," Klesse said. "There is no cellulosic to speak of. Any other advanced ethanol has to be imported. This is not in the interest of our country."
AFPM president Charles Drevna called for the US Environmental Protection Agency (EPA) to immediately waive the impending biofuel mandates in order to ease the recent higher gasoline prices, saying, “The energy landscape in the US is markedly different today than it was when the RFS was enacted in 2007. Today, it is clear that the RFS is not only failing to achieve its environmental goals, but is actively undermining them.”
In response to the Senate hearing on fuel prices, the Iowa Renewable Fuels Association (IRFA) said, “Big Oil would like Congress to believe that with fracking we don’t have to worry about foreign oil anymore. Yet, even with domestic oil production at one of the highest levels in 30 years, crude oil is over $100/bbl and Americans are paying near record-high prices at the pump."
“It’s obvious that Americans not only need higher ethanol blends like E15 and E85 to take the pressure off their lungs, but to take the pressure off their wallets as well," the IRFA added.
Follow Anna on Twitter
($1 = €0.77)
|ICIS news FREE TRIAL|
|Get access to breaking chemical news as it happens.|
|ICIS Global Petrochemical Index (IPEX)|
Asian Chemical Connections