Posted April 4, 2016
When Congress created the Renewable Fuel Standard (RFS) more than a decade ago, lawmakers hoped the federal fuels program would spur development of a domestic biofuels industry that would help reduce oil imports with millions and millions of gallons of home-grown ethanol – with a particular focus on increasing volumes of cellulosic biofuel made from corn stover, wood chips, miscanthus or biogas. By 2022, it was expected that 16 billion gallons of cellulosic biofuel would be produced, but a couple of other things happened instead.
First, the U.S. energy revolution happened. Our crude oil imports fell mostly because of surging domestic oil production, not the RFS. Through safe hydraulic fracturing and horizontal drilling, American output grew from less than 6 million barrels per day to more than 9 million barrels per day – the growth in domestic production more than accounting for the reduction in net imports.
Posted March 11, 2015
To the chorus of voices sounding the alarm on the broken Renewable Fuel Standard (RFS) – AAA, automakers, outdoor power equipment manufacturers, marine manufacturers, turkey and chicken producers, restaurant companies, grocery manufacturers, environmental non-profits and anti-hunger groups – add another: the advanced biofuels industry.
Given the fact the RFS was designed to encourage development of advanced and cellulosic biofuels, the Advanced Biofuels Association’s call for significant RFS reform is a game-changer in the ongoing public policy debate. ABFA President Michael McAdams at this week’s Advanced Bioeconomy Leadership Conference:
“… the Renewable Fuels Standard (RFS) – the very tool that was created to foster our industry – has become one of the greatest obstacles to continued development of the advanced and cellulosic biofuel industry due to inconsistent and poor implementation.”
The issue is the way the RFS, through annual ethanol mandates, has resulted in ever-increasing production of ethanol made from corn – versus ethanol and other biofuels made from non-food feedstocks.
Posted November 24, 2014
For months we’ve been pointing out the brokenness of the Renewable Fuel Standard (RFS), the federal law requiring ever-increasing use of ethanol in the nation’s fuel supply.
We’ve written about the impending “blend wall,” the point where the RFS would require blending more ethanol into gasoline than could be safely used as E10, potentially putting motorists at risk for damage to vehicles while also potentially risking small-engine equipment and marine engines. We’ve written about RFS-mandated use of “phantom” liquid cellulosic biofuels – a fuel that hasn’t been commercially available despite the recent inclusion by EPA of landfill bio gas in that category (more about that in a future post). And we’ve written about how the 2014 requirements for ethanol use were months and months late from EPA, caught up in election-year politics.
The RFS is indeed broken. Late last week EPA basically agreed, announcing it’s waving the white flag on trying to issue ethanol-use requirements for 2014, which has just a little over one month to go. Instead, the agency said it will complete the 2014 targets in 2015 “prior to or in conjunction with action on the 2015 standards rule.”
Posted October 2, 2014
The absurdity surrounding the Renewable Fuel Standard (RFS) continues:
Those Late 2014 Ethanol Requirements – EPA now is 10 months late with setting this year’s requirements for ethanol use. Under the RFS, the agency is required to tell obligated parties, like refiners, how much ethanol they’re required to use in a calendar year by November of the previous year. Thus, requirements for 2014 ethanol use were due in November, 2013.
As it is we’re getting closer to the point where the absurd becomes the ridiculous, with the growing possibility EPA could end up setting 2014’s requirements in 2015. It would be like something from one of the late, great Johnny Carson’s “Carnac the Magnificent” sketches: “Oh Unfortunate Ones, here’s how much ethanol you should have used …”
Posted August 27, 2014
There was an interesting article last year from Ian Boyd, a chief scientific adviser in the government of the United Kingdom. In it Boyd looks at the role that science plays in public policy, including this clarification and warning:
Strictly speaking, the role of science should be to provide information to those having to make decisions, including the public, and to ensure that the uncertainties around that information are made clear. When scientists start to stray into providing views about whether decisions based upon the evidence are right or wrong they risk being politicised.
This comes to mind with a recent Huffington Post article lauding a proposal that would require Chicago service stations to offer E15 fuel, authored by Michael Wang and Jennifer Dunn, scientists with the Argonne National Laboratory.
Wang and Dunn write that mandating E15 – containing 50 percent more ethanol than the E10 gasoline that’s the staple of the U.S. fuel supply – is a “step in the right direction,” because of its environmental benefits. Actually, the Chicago ethanol mandate would be a giant leap backward for consumers, small business owners and, yes, the environment.
Posted June 27, 2014
Count the nonpartisan Congressional Budget Office (CBO) among those cautioning that rising ethanol mandates in the Renewable Fuel Standard (RFS) could negatively impact consumers. In a new analysis, CBO says RFS ethanol requirements by 2017 could cause an increase of 13 cents to 26 cents per gallon in the price of E10 gasoline, the most common vehicular fuel used in the U.S., a rise of 4 percent to 9 percent, and an increase of 30 cents to 51 cents per gallon in the price of petroleum-based diesel, or 9 percent to 14 percent.
Posted April 30, 2014
In seeking regulatory certainty, compliance with rules and deadlines and policies that acknowledge market realities, industry is hardly being unreasonable. Unfortunately, these are scarce in EPA’s setting of new ethanol use levels under the Renewable Fuel Standard (RFS).
Let’s start with deadlines. Under the law EPA was supposed to tell refiners by the end of last November how much ethanol would have to be blended into the U.S. fuel supply this year. Four months into the year, refiners are still waiting. That’s regulatory uncertainty.
Market reality? EPA continues to signal on cellulosic biofuels that the 2014 mandate will have no connection to actual commercial production – setting up an absurd situation where refiners could be penalized because a “phantom fuel” doesn’t exist in commercial volumes necessary to satisfy the mandate.
Hello, EPA, can we talk?
Posted March 25, 2014
Check out our new ads on the Renewable Fuel Standard (RFS) – including a video that highlights in a humorous way the potential negative impacts for consumers from RFS mandates that force higher ethanol blends into the marketplace.
Unfunny would be seeing boaters left high and (not so) dry because their marine engine conked out, damaged by higher ethanol-blend fuel. Or stranded motorists, or home owners with outdoor equipment ruined by using fuel with more ethanol content than the mower or trimmer was designed to use. These are the real-world stakes in the current debate over the RFS and its ethanol mandates.
Posted November 18, 2013
More on EPA’s proposed levels for 2014 ethanol usage that were unveiled last week. While the agency rightly acknowledged the existence of the refining “blend wall” by proposing a lowering of how much ethanol must be blended into the U.S. fuel supply under the Renewable Fuel Standard (RFS), it doesn’t go far enough. The blend wall still looms, and so does EPA’s insistence on requiring millions of gallons of phantom cellulosic biofuels.
We covered the blend wall issue when EPA released its proposal last week. Breaking through the blend wall, requiring refiners to put more ethanol into the fuel supply than is safe for millions of vehicles on the road today, could leave consumers stuck with repair bills and could harm the broader economy, according to a study by NERA Economic Consulting.
Let’s look at cellulosic. We refer to it as the “phantom fuel” because over the past few years EPA has required refiners to blend millions of gallons of it into the fuel supply when none was commercially available (2010 and 2011), or when very little was available (2012) – and then forced refiners to purchase credits from the government because they didn't use a non-existent fuel. This year looks to be similar. EPA’s 2013 mandate requires 6 million “ethanol equivalent” gallons, but to date only about 359,000 gallons have been produced.
Posted October 9, 2013
A tactic used by ethanol backers trying to defend the relatively defenseless Renewable Fuel Standard (RFS) is attempting to frame the RFS debate as one between America’s oil and natural gas companies and renewable energy.
That’s faulty for a couple of important reasons. First, we’re Big Ethanol’s biggest customers, buying billions of gallons a year, as a useful additive in E10 gasoline. Second, our companies are for renewables, not against them, investing $81 billion in renewables and carbon-reduction efforts to reduce greenhouse gas emissions between 2000 and 2012 – nearly as much as all other U.S. industries ($91 billion) and more than the federal government ($80 billion).