Trump Tells EPA to Halt Ethanol Quota Changes Amid Iowa Uproar

October 18, 2017 02:12 PM
Bloomberg Ethanol Plant

(Bloomberg) -- White House officials have directed the Environmental Protection Agency to stand down on efforts to weaken a federal biofuel mandate after pressure from Iowa politicians seeking to preserve demand for corn and soy, said people familiar with the decision.

The agency was told to abandon two changes that were under consideration: a possible reduction in biodiesel requirements and a proposal to allow exported renewable fuel to count toward domestic quotas, said the people, who were not authorized to speak publicly about the move. 

After President Donald Trump spoke with one of the Renewable Fuel Standard’s fierce defenders, Iowa Governor Kim Reynolds, about the issue Wednesday, she tweeted that the discussions were "positive & productive."

Reynolds is one of a phalanx of Midwest politicians who have lobbied the administration to impose robust biofuel quotas by highlighting the president’s promises to support ethanol and signaling that any move to weaken the Renewable Fuel Standard would be seen as a betrayal of those vows. That 12-year-old law requires refiners and importers to use biodiesel, conventional renewable fuel and next-generation alternatives.

It was not immediately clear whether the administration’s decision to relent will be enough to satisfy Midwest politicians who have threatened to hold up EPA nominees over the issue, nor how the EPA can make its intentions clear before a Nov. 30 deadline to finalize next year’s quotas.

The market for ethanol credits indicates traders think ethanol backers will prevail.

Credits tracking compliance with renewable fuel blending quotas for 2017 fell in late September after news reports said EPA was considering changes that would weaken the biofuel requirement. Since hitting a low of 66 cents a credit on Sept. 28 they have bounced back to 79 cents a credit, about what they were before the news broke. That indicates the market doesn’t think the EPA will weaken the standards.  

More: EPA Is Said to Weigh Ethanol Rule Change That Could Aid Icahn

A meeting Tuesday between Scott Pruitt, the head of the EPA, and a group of senators led by Iowa Republican Chuck Grassley came after the agency began considering changes that could make it easier for refiners to meet the mandates. The farm-state lawmakers said they pushed Pruitt to abandon proposals that could weaken the quotas for biofuels.

"You can get in the weeds about what you want to do or not do in the way of policy, but this is an issue of the president keeping his promise," Grassley told reporters after the meeting. 

The criticisms from farm-state lawmakers came after the EPA issued a call for public comment on potential reductions in biodiesel and advanced biofuel quotas. Separately EPA staff were considering a proposal from some refiners to allow exported renewable fuel to count toward the domestic mandate. That change is opposed by the ethanol industry, but supported by refiners who argue it will make meeting the quotas easier and cheaper.

Joni Ernst, the other Iowa senator, told reporters she couldn’t commit to backing Bill Wehrum to head EPA’s air office, the office that administers the renewable fuel program. The planned Environment and Public Works Committee vote on his and other nominations was scrapped. Ernst, a Republican, is a member of that committee, on which Republicans hold a narrow 11-10 margin.

"A handful of senators completely cornmailed the administration by threatening to hold nominees hostage until they get their way," Stephen Brown, the head of federal affairs for refiner Andeaver, said in an email. "Faced with tactics that would have made Don Corleone blush, the administration essentially had no choice but to relent."

Read More: Trump Told Iowa He’d Save Ethanol. His EPA Chief Has Other Ideas

The Renewable Identification Numbers, or RINs, that track compliance with the mandates have been climbing ever since Grassley’s pushback on those proposals became public.

"The track record here has been pretty strong with these Midwest senators," Paul Niznik, a consultant to refiners and others who track the RIN market for Argus Consulting Services. "We know it’s not going to happen. It looks like political theater."

With the agency facing a Nov. 30 deadline to set the final biofuel quotas for 2018, delaying the nomination of Wehrum could be an effective, short-term strategy for ethanol supporters. Mike Danylak, a spokesman for the Senate Environment and Public Works Committee, declined to comment on why the committee vote on the nominations was postponed.

Reynolds, Iowa’s governor, is planning a press conference later Wednesday. 

She will discuss "the threat recent EPA proposals pose to the future of the biofuels industry, which supports tens of thousands of jobs across rural Iowa," according to a press release by the Iowa Renewable Fuels Association. 

©2017 Bloomberg L.P.

Back to news



Spell Check

Heather Patrick
Atlanta, GA
3/20/2018 08:47 AM

  NOW PROPERTIES OWNER WITH THE HELP OF PROSPER LOAN: Share this to help a soul right now, Ya'll will agree with me that the rate of online scamming is increasing by the day. I'm also a victim of it as i was scammed about 25,000usd all in the quest of seeking for an home loan. I actually gave up until a government official directed me to PROSPER LOAN FIRM, Despite the fact of my plight i had to give it a try since it was coming from a top government official. All comment ya'all see online are bullshit and crap, I know the pains i went through just because i was looking for a loan i had to keep on selling valuables to keep paying unforeseen fees. I and some great personality have started a movement to end online scam because people are dying everyday, losing their homes, selling their property just because they need a loan. Apart from been a beneficiary of about 295,000usd in PROSPER LOAN FIRM lending scheme , We have also made a research to see that they are the best around the globe as far as online lending is concern, They have proven their self trustworthy and reliable back to back without failing. To end people debt, financial burden and been victimized here is the details of prosper loan firm. Email: OR call +1(816) 366-8769 to put an end to your financial needs now. I'm Heather Patrick from Georgia, United States. It doesn't take you anything to share this great information and good news. Email: OR call +1(816) 366-8769 and celebrate financial outbreak for the rest of your life.

cooper , IA
3/19/2018 08:55 AM

  This Karen Brown is a real winner her id says she is from Chicago but her post says Chattanooga. No wonder she got into such financial trouble she can't even figure out where she is from. I wonder what her "business" is and if it has anything to do with selling crack because obviously she is on something. Meanwhile ethanol is good as evidenced by the oil companies that got the ethanol subsidies eliminated so all the ethanol plants went broke and were bought for pennies on the dollar by oil companies

Karen Brown
chicago, IL
3/18/2018 11:10 PM

  I AM FINALLY FREE FROM FINANCIAL BONDAGE THANKS TO MOORE LOAN COMPANY ( Good day everyone,I can’t hide this great testimony that took place in my life I will love everyone to know it and be a partaker of this, that is why I want to share it to the whole world by placing this advert on classifieds, I am Mrs Karen Brown by name, I live in Chattanooga, Tennessee United State, I want to thank ROBBINSON MOORE for his kindness upon my family life, I never knew that there is still a sincere and trustworthy lender like this on the internet and on earth. Just some days I was in search for a loan of $ 100,000.00, As I was running out of money for feeding, School fees, My business was really going out of capital and my rent. I was scammed about $15,000.00 dollars and I decided not to involve my self in such business again. But a Friend of mine introduced me to a loan firm due to my appearance and doings and also my complains to her. And I told her that I am not interested in any loan deal anymore but she told me that there is still a sincere lender who she will recommend me to, And she gave me the details of this man who is called MOORE ROBBINSON. And I really put a trial and I am most greatful and lucky today, I was given a loan amount of $95,000,00 Dollars by this great firm MOORE LOAN COMPANY. If you are in need of a genuine, Sincere, durable and a truth worthy loan lender or financial assistance and also you know you can be reliable and trusted, capable of paying back at the due / duration time of the funds I will advice you to send your contact to them via email @[] OR Test (414) 454-9493............


Corn College TV Education Series


Get nearly 8 hours of educational video with Farm Journal's top agronomists. Produced in the field and neatly organized by topic, from spring prep to post-harvest. Order now!


Market Data provided by
Brought to you by Beyer