Weekend open thread: More limbo for ethanol industry edition

What’s on your mind this weekend, Bleeding Heartland readers? This is an open thread: all topics welcome.

About a year ago, the U.S. Environmental Protection Agency announced plans to change the Renewable Fuel Standard, which regulates how much ethanol must be blended into gasoline. Iowa elected officials from both parties expressed unanimous outrage, with Governor Terry Branstad and Representative Bruce Braley seeking out especially prominent roles in the battle against reducing the Renewable Fuel Standard. The very first week of the Iowa legislature’s 2014 session, state lawmakers unanimously approved a non-binding resolution urging the EPA to abandon its proposed rule.

The EPA proposal was supposed to become final in the spring of 2014, but political pressure forced a series of delays. Finally, this past Friday the agency announced “that it will not be finalizing 2014 applicable percentage standards under the Renewable Fuel Standard (RFS) program before the end of 2014.” After the jump I’ve posted reaction from Senators Tom Harkin and Chuck Grassley, Governor Branstad, and Representative Dave Loebsack (D, IA-02).

The immediate impact will be more uncertainty for Iowans whose livelihood depends either directly or indirectly on the ethanol industry. But I would guess that every delay makes it less likely that the EPA will move forward with its original proposal, which could be construed as a victory for Iowa biofuels.

The reality is more complicated than such unusual political consensus implies. At an “all-day pepfest for ethanol” organized by the governor in January, Francis Thicke was the only person to offer the “other side” of the story. Thicke has a doctorate in agronomy and soil science from Iowa State University. His testimony asserted that it is “disingenuous to frame the debate on the Renewable Fuels Standards (RFS) as a struggle between farmers and Big Oil” and that “EPA’s proposed changes to the RFS are not that radical.” Thicke also pointed out, “Corn ethanol was always meant to be a stepping stone to advanced biofuels.” In this guest post, Bleeding Heartland user black desert nomad likewise questioned whether corn ethanol was really “under attack” and argued that “Vested interests want to double-down on endless growth in corn ethanol, but they have lost sight of the long game amidst a tangled web of conflict-of-interest.”  

Excerpt from EPA statement released on November 21:

The EPA Acting Assistant Administrator for the Office of Air and Radiation, Janet McCabe, signed the following document on 11/21/2014, and EPA is submitting it for publication in the Federal Register (FR). […]

Today EPA is announcing that it will not be finalizing 2014 applicable percentage standards under the Renewable Fuel Standard (RFS) program before the end of 2014. In light of this delay in issuing the 2014 RFS standards, the compliance demonstration deadline for the 2013 RFS standards will take place in 2015. EPA will be making modifications to the EPA- Moderated Transaction System (EMTS) to ensure that Renewable Identification Numbers (RINs) generated in 2012 are valid for demonstrating compliance with the 2013 applicable standards.

Statement released by Senator Tom Harkin, November 21:

“The Environmental Protection Agency threw the biofuels industry into chaos and confusion when it proposed lowering 2014 renewable fuel requirements from what we enacted into law. Now, the EPA will allow the uncertainty it created to linger on, saying 2015 is the soonest it will announce the amount of renewable fuel that is required to be blended and used in 2014.The EPA went astray when it gave credence to the notion there is some arbitrary limit to biofuels’ potential in our fuel supply. That is a wrong interpretation of the Renewable Fuel Standard, and the EPA must now issue renewable fuel requirements that meet the purpose and intent of the RFS to boost energy security and jobs while reducing fossil fuel use.”

Statement released by Senator Chuck Grassley, November 21:

Sen. Chuck Grassley of Iowa today made the following comment on the announcement from the Environmental Protection Agency that it will delay finalization of the 2014 Renewable Fuel Standard (RFS) Renewable Volume Obligations (RVO) until 2015.

“The reprieve is mixed news for the farmers and biofuel producers who have responded to the call for more homegrown, renewable energy.  The Administration’s ill-conceived proposal would have caused real harm to farmers, producers, and consumers.  It would have increased dependence on oil and protected the stranglehold Big Oil has on our country’s fuel supply.  Still, the Administration doesn’t deserve praise.  Creating uncertainty for everybody who works in this industry isn’t a good way to do business.  No one knows what kind of proposal the Administration might offer next year.  Uncertainty is the enemy of job creation and investment.  Unfortunately, as we also saw with the Keystone XL pipeline, uncertainty, delay and indecision are hallmarks of this Administration on energy policy.”

Statement released by Governor Terry Branstad and Lieutenant Governor Kim Reynolds, November 21:

Gov. Terry Branstad and Lt. Gov. Kim Reynolds today issued a statement following the Environmental Protection Agency’s (EPA) decision on the Renewable Fuel Standard (RFS). The Agency will not finalize a rule in 2014 and will delay the ruling until 2015 “prior to or in conjunction with action on the 2015 standards rule.”

“We’re pleased the Environmental Protection Agency and the Obama Administration halted their ill-advised proposed rule for the time being, but unfortunately, this decision only creates more uncertainty,” said Branstad. “Across the nation, renewable fuels have helped spark economic development, create jobs, reduce our dependence on foreign oil and increase consumer choice. While we would have liked to see the Environmental Protection Agency commit to a robust Renewable Fuel Standard for the long-term, we received a clear signal through this process that America supports renewable fuels and our state’s work to produce high-quality biofuels.”

“Though we were hoping for the certainty of a robust Renewable Fuel Standard, we’re pleased the Environmental Protection Agency backed away from their initial proposal,” said Reynolds. “We’ll continue fighting for Iowa farmers and consumers who value a choice at the pump and Americans who seek energy independence through safe, reliable and renewable energy.”

Branstad and Reynolds have led the effort in Iowa to stop the EPA’s proposed rule on the RFS. Some examples of their leadership are as follows:

State and Federal elected officials, including Gov. Branstad and Lt. Governor Reynolds, participated in a “Defend the RFS” event.

Gov. Branstad traveled to Washington, DC, joining a group of Iowa farmers and biofuels producers, to testify at the Federal government’s only public RFS hearing and met with EPA Administrator McCarthy.

Gov. Branstad, Lt. Gov. Reynolds, Secretary Bill Northey and the entire Iowa congressional delegation sent a joint letter to Federal leaders advocating for the many benefits that flow from the RFS.

Gov. Terry Branstad and Gov. Mark Dayton (D-Minn.) penned an op-ed in support of a strong RFS.

Gov. Terry Branstad brought together a bipartisan group of six governors to sign on to a letter to President Barack Obama, EPA Administrator Gina McCarthy and United States Secretary of Agriculture Tom Vilsack expressing their support for a strong RFS.

Leaders from across the Midwest joined Gov. Branstad and Lt. Gov. Reynolds for their  “Hearing in Heartland,” which was open to all interested citizens; 83 panelists from across the Midwest Region spoke from the heart about the importance of the RFS to their livelihoods and a healthy rural economy while only two individuals expressed opposition to a robust RFS.

Gov. Branstad, in his Condition of the State address, called on the Iowa Legislature to pass a resolution in support of a robust RFS. The Legislature unanimously passed bicameral, bipartisan resolutions calling for the EPA to reverse course and support a strong RFS. View the resolutions: House Resolution 101 | Senate Resolution 101.

State of Iowa leaders submitted formal comments to the EPA with current data and analysis that demonstrates the positive impact of the RFS and provides Federal leaders the opportunity and obligation to revise their initial volume obligations upward.

Statement released by Representative Dave Loebsack (D, IA-02), November 21:

Washington, D.C. – Congressman Dave Loebsack released the following statement today after the Environmental Protection Agency (EPA) announced that it would not finalize the Renewable Fuel Standard (RFS) obligations for 2014. The original rule proposed by the EPA last year would have had a devastating impact on farmers, rural communities and future investments in biofuels. Loebsack has been leading the fight to highlight the importance of the RFS to Iowa. The EPA’s announcement of the delay can be found here.

“Today’s non-announcement by the EPA only creates further uncertainty for Iowa’s farmers and rural communities. The RFS has proven it is working and is the right policy for Iowa and our country. I am pleased the EPA did not move forward with their original proposal for 2014, which would have devastated Iowa’s farmers, but now it is time for the EPA to get it right. The RFS creates jobs, supports our agricultural communities and lessens our dependence on foreign oil. I will continue to fight to ensure the EPA follows the law with a robust RFS that provides the certainty our farmers deserve.”

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