The Environmental Protection Agency's renewable fuel program is bound to fail over the next five years, a federal watchdog agency said Monday, citing the low cost of oil and the relatively high cost of green fuels.
The Government Accountability Office released two reports showing that the EPA's Renewable Fuel Standard will not reach its 2022 production target of blending 36 billion gallons of renewable fuel per year into the nation's fuel supply, while failing to achieve its greenhouse gas emission reductions.
Greenhouse gas emissions from burning fossil fuels are blamed by many scientists for causing the Earth's temperature to rise.
"It is unlikely that the goals of the RFS will be met as envisioned because there is limited production of advanced biofuels to be blended into domestic transportation fuels and limited potential for expanded production by 2022," one of the two GAO reports said.
The reports showed that advanced biofuels are the primary sticking point. Under the program, the fuels are expected to comprise nearly half of the total 2022 target. The fuels are also mandated to be lower in carbon pollution than more conventional biofuels such as corn ethanol. But without adequate production, the climate change benefits of the program have been lower than expected.
"In the absence of advanced biofuels, most of the biofuel blended under the RFS to date has been conventional corn-starch ethanol, which achieves smaller greenhouse gas emission reductions compared with advanced biofuels," the report focused on emissions said.
The second report, focused solely on advanced biofuel production, showed the fuels will fall short of their production targets.
"Among the factors that will affect the speed and volume of production, experts cited the low price of fossil fuels relative to advanced biofuels," the report said. "This disparity in costs is a disincentive for consumers to adopt greater use of biofuels and also a deterrent for private investors entering the advanced biofuels market."
The report said that increased "uncertainty" about the fuel program and federal subsidies for advanced biofuels is also a deterrent to higher production.
"While such policies should encourage investment, investors do not see them as reliable and thus discount their potential benefits when considering whether to invest," the report said.