The Environmental Protection Agency will raise the required amount of biofuel required to be in the nation’s fuel supply next year but will keep the amount below levels required by Congress.
Janet McCabe, acting assistant administrator for the EPA’s Office of Air and Radiation, announced Monday the amount of biofuel required in the nation’s fuel supply in 2016 would be 18.11 billion gallons, far below the 22.5 billion gallons initially envisioned by Congress.
“The biofuel industry is an incredible American success story, and the RFS program has been an important driver of that success—cutting carbon pollution, reducing our dependence on foreign oil, and sparking rural economic development,” McCabe said in a statement. “With today’s final rule, and as Congress intended, EPA is establishing volumes that go beyond historic levels and grow the amount of biofuel in the market over time. Our standards provide for ambitious, achievable growth.”
The vast majority of that biofuel will come from corn ethanol. The weakened standard surely will anger corn suppliers.
It’s the first time the biofuel standards have been set since 2013. The announcement Monday also retroactively set the standards for 2014 and 2015 for the actual amount of biofuel used those years. The EPA was required by a settlement with the oil industry to publish the rules on Monday.
The oil industry has voiced concerns that the 2016 standard could push the amount of biofuel in the nation’s fuel supply past the “blend wall,” since the Renewable Fuel Standard requires a certain amount of biofuel, rather than a percentage, be added to the nation’s gasoline supply.
The blend wall is the percentage of biofuel in gasoline that can be processed without harming a vehicle’s engine, which the industry says is 10 percent.
The EPA projects gasoline demand will reverse recent trends and increase in 2016 because of cheaper prices. The higher demand for gasoline would increase the amount of fuel being used and keep the amount of biofuel going into gasoline from breaking the blend wall, according to the agency.
Supporters of the regulation say it helps reduce the amount of carbon dioxide released into the atmosphere from the burning of gasoline by car engines. However, many studies show the Renewable Fuel Standard has led to significant reductions in the amount of grasslands, which are being turned into farms to grow corn, and offsetting, and sometimes exceeding, any reductions in carbon dioxide levels.
David Banks, executive vice president of the anti-ethanol group American Council for Capital Formation, said he’s disappointed the standard was increased from 2015 levels but he’s glad the EPA kept it below the congressionally mandated 22.5 billion gallons. He called that an important precedent.
“What this marks is the beginning of the end of this ineffective, costly program, and the only question now is how much more will the American consumer have to needlessly pay, and for how long, before this senseless mandate is finally retired,” Banks said.
