RFA: EPA’s Final RFS Rule Puts Future of Biofuels & Climate Policy in Hands of Oil Industry

The Renewable Fuels Association has been steadfast in calling on EPA to allow the volumes contained in the RFS statute to drive market place change. RFA President and CEO Bob Dinneen released the following statement on the day the final RFS volumes were announced on Nov. 30:

“EPA’s decision turns our nation’s most successful energy policy on its head. When EPA released its proposed RFS rule in May, the agency claimed it was attempting to get the program back on track. Today’s decision, however, fails to do that. It will deepen uncertainty in the marketplace and thus chill investment in second-generation biofuels. Unlike Big Oil, the ethanol industry does not receive billions in tax subsidies and the RFS is our only means of accessing a marketplace that is overwhelmingly and unfairly dominated by the petroleum industry. Today’s decision will severely cripple the program’s ability to incentivize infrastructure investments that are crucial to break through the so-called blend wall and create a larger market for all biofuels.

“There is simply no reason for EPA to adopt API’s blend wall narrative. Data shows that EPA, in its initial RFS proposal, understated the likely market for E85 and non-ethanol conventional biofuels in 2016 by at least 440 million gallons. The data suggests there will be at least 14.7 billion gallons of undifferentiated renewable fuel blended next year. With approximately 2 billion surplus RIN credits already available for refiners to use for compliance in 2016, and with another 900 million RINs potentially becoming available from 2015 over-compliance, the EPA’s decision to lower the 2016 RVO below the statutorily imposed level of 15 billion gallons is simply unnecessary.

“What makes today’s decision even more perplexing is that it continues to reflect the administration’s conflicting views regarding ethanol. The Department of Agriculture continues to fight for ethanol, working hard to secure necessary infrastructure, promoting exports, correcting food versus fuel myths, investing in new technologies and new feedstocks and advocating for ethanol’s positive climate change benefits. The Department of Energy, too, works hard to complete biofuel research on higher ethanol blends and infrastructure that is moving this industry forward. Why is EPA so out of step?

“Today’s decision by EPA furthers that conflict and, sadly, significantly undercuts President Obama’s credibility as he prepares to take the world stage to address climate change at the COP21 talks in Paris. RFA recently commissioned a study which concluded that biofuels consumed under the RFS have reduced U.S. greenhouse gas (GHG) emissions by 354 million metric tons of carbon dioxide-equivalent since 2008. For context, that is the equivalent of avoiding carbon dioxide emissions from 74 million passenger cars. How can the president speak credibly about the need to address climate change on a global stage when his EPA is failing to fully implement the most potent and proven weapon to combat climate change in his own backyard?”

“This final rule directly contravenes the statute and places the potential growth for biofuels like ethanol in the hands of the oil companies. It will have the unfortunate consequence of increasing Big Oil’s ability to thwart consumer choice at the pump without even a scintilla of fear that EPA will enforce the statute. With no consequences for Big Oil’s bad behavior, consumers will be denied greater access to the lowest cost liquid transportation fuel and number one source of octane on the planet.”