EPA actually considering scaling back on RFS’s ethanol blending requirements?

posted at 1:21 pm on October 11, 2013 by Erika Johnsen

As we are all painfully well aware, the esteemed bureaucrats at the Environmental Protection Agency rarely-to-never take kindly to the suggestion that they should provide the private sector with any leeway in complying with their ambitious regulatory agenda, nor otherwise cede any iota of their authority or admit to policy mistakes. So… this could actually be kind of huge. Via Reuters:

Federal environmental regulators are expected to significantly reduce their biofuel blending mandates for next year, marking a historic retreat from an ambitious 2007 law, according to industry and trade sources.

The U.S. Environmental Protection Agency (EPA) is considering a proposal that would set next year’s target for use of renewable fuels at 15.21 billion gallons, less than the 18.15-billion gallon 2014 target established in the law, according to the sources, who said the new figures have circulated in Washington policy circles over the past week.

At 15.21 billion gallons, the proposal would leave room only for some 13 billion gallons of corn-based ethanol to be blended into the nation’s gasoline supply – down from 13.8 billion this year and 14.4 billion required by law for 2014.

Speculation and media reports about the potential reduction in the blending levels ripped through financial markets on Thursday, spurring a major rally in the shares of independent refiners who have been paying hundreds of millions of dollars to buy ethanol credits to cover their blending obligations.

To review for any newcomers to the glorified piece of centrally planned corporate pork that is the Renewable Fuel Standard: Through the EPA-administered RFS, refiners are required to blend a certain amount of certain biofuels into the country’s fuel supply or else purchase credits to excuse themselves from doing so, and the government periodically increases the mandated blending ratio (you may recall that the EPA even tried to penalize oil companies for failing to adequately comply with last year’s level, never mind that the cellulosic biofuels to which they were referring were not actually commercially available in the necessary quantities, and then they went ahead and again increased the blending requirement anyway, supremely confident in their own misbegotten wisdom).

The debate over the Renewable Fuel Standard reached a pitch this summer when the aforementioned ethanol credits started to get particularly pricey as refiners complained that they were running up against the “blend wall,” meaning that the mixing the required volumes will exceed the 10 percent threshold the industry finds doable for use in cars and trucks.

The EPA has been heretofore undeterred in continually raising the requirements, but I suppose it must be getting harder to ignore that nobody but nobody except agribusiness and their associated Big Ethanol lobbyists are fans of ethanol — not oil companies, not environmentalists (and how often do those two groups unite?!), and certainly not American consumers paying higher food and gasoline prices as a consequence. Ergo, it sounds like they’re looking at easing up on furthering the expensive boondoggle — which is a nice improvement, but it is not enough to merely mitigate the impracticality of the whole thing. We need to do away with it once and for all, and there is, mercifully, growing bipartisan support for that endeavor.


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[A]nd certainly not consumers paying higher food and gasoline prices as a consequence.

Don’t forget reduced MPG, power, and shorter life span of motors.

NotCoach on October 11, 2013 at 1:26 PM

I wish ethanol would just go away, so my gas mileage can go up.

Ward Cleaver on October 11, 2013 at 1:26 PM

Totally screws up the carbs on my old Jap Superbike.

faol on October 11, 2013 at 1:30 PM

Ridiculous
Fuel
Standard

Bitter Clinger on October 11, 2013 at 1:30 PM

At 15.21 billion gallons, the proposal would leave room only for some 13 billion gallons of corn-based ethanol to be blended into the nation’s gasoline supply

Still 13 billion gallons too much.

iurockhead on October 11, 2013 at 1:38 PM

The fact that the RFS continues to exist is a testament to the insanity of our current government.

mbs on October 11, 2013 at 1:39 PM

I refuse to buy gasoline with ethanol in it unless I absolutely have no choice, and there are many service stations in my area who offer 100% gas, but I discovered on a recent road trip that ethanol free gas is not even available in some areas. More insanity.

mbs on October 11, 2013 at 1:41 PM

Why wont the EPA accept Methanol? From Methane gas?

…Oh yeah fracking and using our own cheap and limitless natural gas is still verboten

elowe on October 11, 2013 at 1:55 PM

This will hurt the economy … because people won’t be forced to buy new cars as often (after ethanol has destroyed their old ones).

besser tot als rot on October 11, 2013 at 1:57 PM

Would I be out of line to say I don’t trust them to do the right thing…….ever?

antipc on October 11, 2013 at 1:58 PM

Governing by trial-and-error. I hope they don’t ever try that technique with, say, any new agency website, or something.

Tsar of Earth on October 11, 2013 at 2:00 PM

Could this be a small crack in the climate change hoax? As I recall the whole bio-fuel had a lot to do with reducing the carbon footprint of the country.

Dr. Frank Enstine on October 11, 2013 at 2:06 PM

The most efficient corn-to-ethanol processes use, on an energy basis, about 80 Btu of fossil fuel to produce 100 Btu of ethanol. Relative to producing 100 gallons of gasoline from petroleum, mandating 10% ethanol in gasoline requires 90 gallons of straight gasoline plus 8 gallons of gasoline to make ethanol, so that the “renewable” fuel standard only saves at most 2% of the gasoline.

Meanwhile, we are depriving starving people of the food value of the corn. The EPA updated version of “Let them eat cake” is “Let them drink gasoline”.

Steve Z on October 11, 2013 at 2:27 PM

Put the ethanol to better use. Drink it!

14 billion gallons of ethanol would provide roughly 45 gallons of 195 proof vodka for every man woman and child. More realistically it would give each of us 90 gallons of 97 proof vodka.

Side benefits would be: we wouldn’t care about the government shutdown, or about Obamacare, or whether our girlfriends were pretty of not. We would die earlier saving on Social Security and Medicare. It’s win/win.

Corky Boyd on October 11, 2013 at 2:29 PM

This is a perfect example of the idiocy of EPA.

Numerous EPA regs and rules “pinch” compliance.

EPA mandates higher fuel economy targets for automobiles. The environmental benefit is that less gasoline is consumed (leaving out the economic arguments, consumer choice arguments, etc.).

Now they mandate more gallons of of additives to be mixed into gasoline, which is potentially forcing blenders/refiners to go over the 10% threshold.

A simple math explanation with made-up numbers:
Today:
Cars consume 10 gallons today. 10% ethanol/cellulosic = 1 gallon. Government mandates 0.8 gallons blend so they are good and able to meet the targets.

Tomorrow:
Cars consume 8 gallons tomorrow. 10% ethanol/celluosic = 0.8 gallons. EPA mandates 1.0 gallons of blend so they are unable to meet the new blend requirements without exceeding the 10% threshold thanks to government mandated improvements in fuel economy standards.

EPA’s new philosophy is to push from both sides to essentially leave no choice but to close up shop.

weaselyone on October 11, 2013 at 2:31 PM

I refuse to buy gasoline with ethanol in it unless I absolutely have no choice, and there are many service stations in my area who offer 100% gas, but I discovered on a recent road trip that ethanol free gas is not even available in some areas. More insanity.

mbs on October 11, 2013 at 1:41 PM

The refiners we get our fuel from just switched to an ethanol blend. We can’t get pure unleaded delivered to us at all.

cptacek on October 11, 2013 at 2:33 PM

[A]nd certainly not consumers paying higher food and gasoline prices as a consequence.

Don’t forget reduced MPG, power, and shorter life span of motors.

NotCoach on October 11, 2013 at 1:26 PM

Totally screws up the carbs on my old Jap Superbike.

faol on October 11, 2013 at 1:30 PM

All part of the plan. Vehicles that no longer run are no longer a Threat To Holy Mother Gaia.

And if they can force you to buy a “green” vehicle, or better yet deny you a vehicle (“Prove you need one”) and make you use public transportation, it’s an all-around win for them.

Never attribute to incompetence what is explainable by the actor’s known fixity of malice. It’s as foolish with “deep-green” fanatics as it is with the Islamist variety.

clear ether

eon

eon on October 11, 2013 at 2:34 PM

I must have just awoken from a Rumplestiltskin type of sleep. Please remind me again as to why the feral govmint has an agency to tell oil refiners how to manufacture gasoline, and has the power to order (yes order as in do it my way or else) these refiners to do something that is impossible.

I don’t think the EPA should go away. The next mentally healthy President should reform the EPA as a collaborative partner, not a punitive gestapo, with the private sector to assure proper stewardship of our environment. On second thought, maybe I’ll just go take another nap…..

NOMOBO on October 11, 2013 at 2:52 PM

Don’t forget reduced MPG, power, and shorter life span of motors.

NotCoach on October 11, 2013 at 1:26 PM

And the added expense of 1 ounce of fuel stabilizer per ten gallons of 10% ethanol gas for any marine application.

Johnnyreb on October 11, 2013 at 3:01 PM

Put the ethanol to better use. Drink it!

14 billion gallons of ethanol would provide roughly 45 gallons of 195 proof vodka for every man woman and child. More realistically it would give each of us 90 gallons of 97 proof vodka.

Side benefits would be: we wouldn’t care about the government shutdown, or about Obamacare, or whether our girlfriends were pretty of not. We would die earlier saving on Social Security and Medicare. It’s win/win.

You would die earlier. Much earlier. They poison it.

The ethanol produced at the big corn stills in this part of the country is itself blended with about 10% methanol, which will kill you dead. The idea is to discourage plant employees from carting home a thermos-full of the kickapoo joy juice.

See? There’s no fun in this whole steaming mess at all.

Humphrey on October 11, 2013 at 3:11 PM

I suppose it must be getting harder to ignore that nobody but nobody except agribusiness and their associated Big Ethanol lobbyists are fans of ethanol

That, or they see the GOP developing a nascent spine and figure this will help remove themselves from the radar.

Kafir on October 11, 2013 at 3:43 PM

I refuse to buy gasoline with ethanol in it unless I absolutely have no choice, and there are many service stations in my area who offer 100% gas, but I discovered on a recent road trip that ethanol free gas is not even available in some areas. More insanity.

mbs on October 11, 2013 at 1:41 PM

Lucky for you. 100% is hard to get in most large (ie run by damn liberals) metro areas. You can generally drive outside of the cities to get to it, but 20 miles just to fill up is nuts.

See http://pure-gas.org/

for a list of stations that sell real gasoline.

slickwillie2001 on October 11, 2013 at 4:16 PM