Agency to seek public input through July 11
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EPA today holds a hearing in Kansas City, Missouri, about its proposed Renewable Fuel Standard (RFS) volume requirements for 2017 on renewable fuels and 2018 for biomass-based diesel. The oil industry will likely propose at least one reform for the RFS. Refiner Valero, which also the third-largest US ethanol producer, will reportedly push EPA to shift the point of obligation for the requirement, according to a copy of its testimony. “Currently under the RFS, the obligation is set at the refinery gate, while the mechanism to achieve compliance is at the point of blending at the rack,” Valero’s Matthew Hodges is set to testify. This disconnect harms independent refiners, small retailers and renewable fuel producers, Valero said. Changing the obligation would provide broader incentives to invest in blending infrastructure, and lead to more sales of higher blended fuels, Hodges will argue. On tap to speak in favor of ethanol will be Nebraska Gov. Pete Ricketts and Richard Fordyce, director of agriculture in Missouri. Ethanol producers are likely to argue EPA erred in cutting the requirements below the statutory levels, and that growing fuel demand makes those targets achievable. Ricketts and Nebraska farm groups decried the EPA’s proposal to lower the target for conventional ethanol blended fuel in 2017 under the RFA to 14.8 billion gallons. If adopted, this proposal would fall below the level of 15 billion gallons dictated in federal law. “Once again, the EPA is proposing to lower the RFA and to break their promise to the American people,” said Governor Ricketts. “Continued efforts to lower the RFS will negatively impact Nebraska and other Midwestern states by creating uncertainty for companies who are investing in our communities and bringing the jobs we need to continue to make our state the best place in the world to live, work, and raise a family. I urge the Obama Administration to reconsider their proposed reduction, and to keep their promise on the RFS to the American people.” Renewable Fuels Association CEO Bob Dinneen said EPA’s proposed volume requirements for 2017 are an improvement over those set in the agency’s final rule for 2014-2016. However, he said the plan “still violates the law by inappropriately applying the ‘general waiver’ provision to conventional renewable fuels, and suggesting there is an ‘inadequate supply’ (of ethanol) to meet the 15 billion-gallon statutory requirement.” He added that, “EPA may only grant a general waiver based on ‘inadequate supply’ if the biofuels industry lacks the capability to produce the required volume of renewable fuel. Clearly that is not the case today.” Others expected to testify include Chip Bowling, president of the National Corn Growers Association, and Emily Skor, the new CEO of Growth Energy, as well as representatives from the National Biodiesel Board and the American Coalition for Ethanol. Several state commodity group leaders will also be testifying. An Iowa Farm Bureau member will tell the EPA to stay the course Congress laid out under the RFS. American Farm Bureau congressional relations director Andrew Walmsley said EPA needs to reconsider the proposal. “We’re all kind of left scratching our heads as to why EPA is not meeting the statutory requirements. There’s enough biofuel out there, there’s enough Renewable Identification Numbers, which is a system that helps refiners meet the standards available. So we’re telling EPA to stick with the statute and reconsider what they have proposed,” Walmsley said. “When EPA doesn’t fit to what we all agree to it makes us wonder what’s next. Both from having predictability in the marketplace and being able to meet the demands of growing food, fiber and fuel, but what that also does to stifle future innovation.” A conference line has been set up for the public hearing in listen-only mode and will open when the hearing begins at 9:00 a.m. Central time. To listen in to the hearing, dial: 877-396-8104 (Toll-Free) or 720-362-6938 (Toll), and enter participant code 29834687#. In announcing the RFS proposal for 2017 on renewable fuels and 2018 on biodiesel, EPA said they were “proposing to use the waiver mechanisms provided by Congress to establish volume requirements that would be lower than the statutory targets for fuels other than biomass-based diesel, but set at a level that we believe would spur growth in renewable fuel use, consistent with Congressional intent.” This will be another area of focus for those appearing at the meeting today, as EPA said when they announced the proposed plan that they took the action due to “real-world constraints, such as the slower than expected development of the cellulosic biofuel industry and constraints in the marketplace needed to supply certain biofuels to consumers.” Those situations have made the statutory levels in the 2007 energy law “impossible to achieve,” EPA stated.
Comments: It’s not clear that the public input from this session and via a comment period open through July 11 will alter the agency’s proposal, but they did raise that possibility in making their initial plan public, saying the final standards set for 2017 and the final biodiesel volume requirement for 2018 “will take into account comments received in response to this proposal and relevant new or updated information that becomes available prior to the final rule. As a result, the final standards that we set for 2017 and the final BBD volume requirement for 2018 may differ from those we have proposed.”
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NOTE: This column is copyrighted material; therefore reproduction or retransmission is prohibited under U.S. copyright laws. | ||
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