EPA’s RFS Announcement Satisfies None

After a yearlong delay, the Environmental Protection Agency (EPA) has announced its proposed Renewable Fuel Obligations under the Renewable Fuel Standard, and nobody, including corn farmers, ethanol producers, or the gas industry, is pleased.

The EPA recommended total combined RFS levels of 15.93 billion gallons of ethanol and ethanol equivalent fuel, including cellulosic, biomass diesel, advanced biofuels, and corn-based ethanol for 2014, 16.3 billion gallons for 2015, and 17.4 billion gallons for 2016. For corn-based ethanol, the EPA recommended 13.4 billion gallons for 2015, and 14 billion gallons for 2016.

Janet McCabe, the acting assistant administrator for the EPA says, “We believe these proposed volume requirements will provide a strong incentive for continued investment and growth in biofuels,” however, the country’s corn growers, oil industry, and renewable fuels industry disagree.

By cutting the corn ethanol obligation by 3.75 billion gallons between 2014 and 2016, the EPA is reducing the industry’s corn demand by almost a billion and a half bushels, and the Renewable Fuels Association claims that the obligations represent a digression after the industry produced 14.3 billion gallons of ethanol last year. The American Petroleum Institute is joining the push-back, saying, “Today’s announcement makes abundantly clear that the only solution is for Congress to repeal or significantly reform the RFS.”

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