US EPA biofuel mandates draw ire from ethanol advocate

MINNEAPOLIS (ICIS)–The US government has sent mixed messages about the Renewable Fuel Standard (RFS) and the biofuel industry, the executive director of the National Corn-to-Ethanol Research Center said on Monday.

John Caupert said he is puzzled by the US Environmental Protection Agency (EPA) move to reduce the biofuel production mandates set forth years ago when the RFS was passed.

“There’s no logic to their reasoning,” he said. “They are just playing into the hands of the petroleum industry.”

He made his comments on the sidelines of the “Ethanol 101” session during the 2015 International Fuel Ethanol Workshop & Expo in Minneapolis, Minnesota. The conference ends on Thursday.

The EPA announced last week that it was revising down the biofuel mandates, which includes ethanol, under the RFS.

The EPA retroactively set the 2014 mandate at 15.93bn gal of biofuel, the number that was actually produced last year, down from the previously set mandate of 18.5bn gal.

For 2015, the mandate was set at 16.3bn gal, which was also down from 18.5bn gal. EPA also said it was setting the 2016 biofuel mandate at 17.4bn gal, short of the statutory target of 22.25bn gal.

The original targets were set years ago but came under severe scrutiny from the oil and gas industry as domestic production began to grow with the advent of horizontal drilling and skyrocketing oil and gas production from shale fields, reducing the need for foreign imports.

Caupert said the reduced mandates were “absurd,” and called into question the mixed messages from the US government.

He said these EPA requirements go against recent announcements by the US Department of Agriculture (USDA) to invest up to $100m in infrastructure to boost renewable fuel use.

Specifically, USDA will administer competitive grants to match funding for state-led efforts to test and evaluate innovative and comprehensive approaches to market higher blends of renewable fuel, such as E15 and E85. States that are able to provide greater than a one-to-one ratio in funding will receive higher consideration.

“American-made, clean energy sources support the environment, reduce our dependence on foreign oil, create jobs and sustain the economy in rural communities across the country. We are fortunate that our farmers are producing record amounts of feedstock for these fuels,” USDA Secretary Tom Vilsack said in a prepared statement last week. “However, a combination of factors, including lower commodity prices and reduced demand for feed as the poultry industry recovers from highly pathogenic avian influenza, are creating uncertainty for America’s corn and soybean producers.”

The revised RFS mandates were not well-received by the oil and gas industry either.

Many advocates of the oil and gas industry felt that the EPA did not go far enough in the reductions.