Major lobbies going toe-to-toe in the ongoing ethanol-mandate battle

posted at 9:01 pm on January 30, 2013 by Erika Johnsen

Last week, a federal appeals court informed the Environmental Protection Agency that, no actually, the EPA may not punish oil companies for failing to comply with the Renewable Fuel Standard, which mandates that they blend a certain amount of advanced cellulosic biofuels into their product — seeing as how those cellulosic biofuels aren’t actually available in the required amounts. As in, they do not exist yet. (…Yes, sadly, this is real life.) Unfortunately, the court’s ruling did not do away with the wildly enthusiastic and unrealistic mandate altogether, it merely took the teeth out of its enforcement for 2012.

The EPA has been shamelessly throwing bones like this to the well-monied, rent-seeking ethanol/agribusiness lobby for years now, the ‘unintended’ (more like, neglected) consequences be damned — and the oil industry, automaking industry, et al are doing some battle, via the WSJ:

Auto makers and oil companies stepped up their campaign against gasoline blended with extra ethanol, releasing a study Tuesday that said the fuel could cause cars to break down on the road.

Ethanol makers, who are facing growing political headwinds, said the study was flawed and that the problems it identifies might be tied to car components, not the fuel. …

A study by the Coordinating Research Council—a group backed by Ford Motor Co., Honda Motor Co. and Toyota Motor Corp., among others—said testing showed E15 could cause erratic fuel-gauge readings and check-engine alerts. The tests involved fuel pumps and gas-tank sensors used in five popular models, including the 2004 Ford Ranger and 2007 Nissan Altima, the council said. …

Growth Energy, a pro-ethanol group, said oil companies and auto makers had a political agenda and were cherry-picking data. “Today’s study is no surprise,” said Tom Buis, the group’s chief executive. “Oil companies are desperate to prevent the use of higher blends of renewable fuels.” …

A political agenda? Cherry-picking data? Really? Of course everyone involved here has a political agenda, because the federal government is so hugely metastasized and self-involved in selecting marketplace winners and losers, that all kinds of companies are incentivized to divert some of their resources from truly growth-boosting productivity to political lobbying. But did anyone ever stop to think that the federal government should just back the heck off and let consumers in the free market drive price-efficient innovation and competition? But no, the ethanol lobby cannot allow that, because they know they cannot win that contest — ethanol is not cost-effective, it drives up food prices, and even real environmentalists don’t like it.

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