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Democrats call ethanol mandate an environmental 'flop'

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Democratic lawmakers say their bill would help resolve issues regarding the high price of ethanol credits. (AP Photo/Nati Harnik)

A group of Democrats apologized for the failed experiment that is the nation's ethanol mandate on Thursday, calling it a "flop" and introducing legislation that would phase out corn ethanol use in six years.

“We made a mistake,” said Henry Waxman of California, the former Democratic chairman of the House Energy and Commerce Committee, who drove the passage of the Renewable Fuel Standard, or RFS, in a comprehensive energy bill passed in 2007.

“The law hasn’t worked out as we intended,” Waxman said in joining lawmakers on a call with reporters Thursday to talk about new legislation that seeks to fix that mistake. Waxman left Congress in 2015.

Rep. Peter Welch, D-Vt., and Sen. Tom Udall, D-N.M., introduced the Greener Fuels Act, saying that the Environmental Protection Agency's RFS has been a failure for the environment.

“We’ve now had more than a decade of experience with it, and it had the best of intentions," Welch said. "But it has turned out to be a well-intended flop."

Welch said those who supported the RFS in the Energy Independence and Security Act of 2007 were mistaken to think it would help curb climate change and that there is ample evidence it has made it worse.

"It actually doesn’t cut down on greenhouse gas emissions, it expands them," Welch said. "It's had a significant impact on overplanting in fragile areas of the corn belt. It has had significant impacts on small engines. And its also had a significant impact on feed prices … and there is a lot of evidence it has increased the cost of food.”

His bill would cap the corn ethanol mandate at 9.7 percent of the nation's fuel mix, while moving to phase it out in 2023 and barring higher ethanol fuel blends from being sold. Many of those changes sound close to Republican-led bills introduced in the past.

The bill also would change the program to ensure that truly renewable biofuels, those derived from agriculture waste and plant cellulose, are given proper incentives under the RFS.

“Corn is not good for the environment, but other cellulosic fuels are,” Welch said.

He said lawmakers from both parties have tried to address the problems with the RFS but the environmental factors have been missing. The Greener Fuels Act looks to address those.

Welch and Udall say their bill would complement legislation being drafted by Senate Majority Whip John Cornyn, R-Texas. Cornyn is developing a bill that looks to resolve an economic concern between the oil refiners and the corn farmers.

The Democratic lawmakers say their bill would help achieve many of the same goals that Cornyn and Sen. Ted Cruz, R-Texas, are looking to resolve regarding the high price of ethanol credits, otherwise known as Renewable Identification Numbers, or RINs. The price of RINs has made it more difficult for refiners to comply with the mandate. Many independent refiners must buy the credits to meet the ethanol blending requirements.

Cruz sat down with President Trump twice last week to discuss a compromise that would cap the price of RINs at 10 cents, while allowing more ethanol to be blended into the gasoline supply.

The Democratic bill's reduction in ethanol use to 9.7 percent would help keep the RIN price stable, Welch said. But it would not help the ethanol industry reach its goal of blending higher amounts of ethanol. Cruz is trying to work with ethanol backers in the Senate to allow 15 percent ethanol fuel to be blended year-round, which would drive up corn ethanol use.

Udall said the bill also would help farmers restore cornfields to pasture and wildlife habitat by using a 10-cents-per-RIN fee to fund a new Private Land Protection and Restoration Fund.

Nearly all the major biofuel trade groups that support the RFS said they oppose the Democratic bill. Emily Skor, president and CEO of the pro-ethanol group Growth Energy, said the Welch-Udall bill was "dead on arrival."

She said the bill appears to be oil companies trying "to ghostwrite legislation for environmental front groups," alluding to the fact that the oil industry has tried to get the EPA to approve limiting the ethanol mandate to 9.7 percent.

Welch and Udall were joined on the call by the Sierra Club and the National Wildlife Federation, which adamantly support eliminating corn ethanol from the RFS.