The wrangling over the nation’s ethanol mandate is heading into March, as refinery workers from nearly a dozen states and the steelworkers union descend on Washington next week to tell lawmakers how the program is harming their livelihoods.
The lobbying push organized by the United Steelworkers begins Tuesday with visits by 30 workers from more than a dozen independent merchant oil refineries in 11 states to discuss “the urgent need” to overhaul the Environmental Protection Agency’s Renewable Fuel Standard.
The lobbying push follows a week of unprecedented attention by President Trump, who hosted multiple meetings this week with the industry and senators to hash an agreement on how to fix the program.
Industry sources after the meetings suggested the goal of this week’s discussions on the ethanol mandate was about keeping the two sides talking about how to fix the problem, not to necessarily resolve the debate.
Hence, the fight will continue in Washington next week, with the unions and refinery workers making their case to Congress on Tuesday and Wednesday.
Their primary message will be about how ethanol credits, or RINs, that refiners have to buy to abide by the Environmental Protection Agency’s ethanol mandate “threaten thousands of family-supporting, community-sustaining jobs across the country,” according to the union.
“Although the multibillion dollar ethanol industry and its powerful lobbyists are determined to prove otherwise, our laws are not intended to guarantee profits for RIN traders,” said Kim Nibarger, the United Steelworkers national oil bargaining chairman, who will be leading the meetings in Washington. The refiners are currently forced to buy the RINs at “artificially inflated prices,” because most of the independent refinery industry lacks the infrastructure to blend ethanol into the gasoline supply.
“A growing number of elected leaders from both parties have already joined us in calling for RFS reform that benefits consumers and protects oil community jobs without significantly impacting the ethanol industry,” Nibarger said. “We welcome the support of others who will stand with us to demand a fair compromise.”
That compromise is what Republican Sens. Ted Cruz of Texas and Pat Toomey of Pennsylvania pushed at the meeting with Trump. They want the administration to cap the cost of ethanol RINs at 10 cents, ensuring that the price cannot rise. But the pro-ethanol camp does not support the idea because it says it would hurt demand for ethanol.
Republican Sen. Chuck Grassley, from the ethanol-producing state of Iowa who was at both meetings this week, said the only solution to the problem is to allow higher amounts of ethanol to be blended in the fuel supply. That would solve both the refiners’ concerns about high RIN prices by ensuring that costs stay low, while creating a larger market for renewable fuel blends.
Some refinery CEOs at the meeting did not say which policy they support after the Thursday meeting, but said they will continue to work with all parties to “provide important reforms that are a win for farmers and a win for union refinery workers,” according to PBF Energy CEO Thomas Nimbley. PBF Energy had been looking for changes to the RFS to waive the need for refiners to buy RINs under the EPA program.
“It is hugely important to our national security and a reliable gasoline supply to have modest reforms to the Renewable Fuel Standard that can protect hardworking union jobs in the Northeast and across the country,” Nimbley said after the meeting.
East Coast refiners are particularly susceptible to the ethanol mandate’s cost, according to the industry. The largest refinery in the region, Philadelphia Energy Solutions, said it had to file for bankruptcy protection because of the high cost of RINs.
This week’s lobbying campaign will include workers from the Philadelphia Energy Solutions and Monroe Energy refineries, which are in the Philadelphia area.
PBF Energy workers from refineries in California, Delaware, New Jersey, Louisiana, and Ohio will fly in for the event.
Western workers from HollyFrontier refineries in Kansas, Wyoming, and Utah will also be joining. Valero refinery workers from Louisiana, Tennessee, and Texas will also be on Capitol Hill. Most of the companies represented were at last week’s meetings with Trump.
