More EPA Exemptions, Biofuel Plants Shuttered

FROM THE SEPTEMBER ISSUE: Growth Energy's ad campaign part of an effort to curtail EPA's abuse of small refinery exemptions.
By Emily Skor | August 14, 2019

During President Donald Trump’s visit to Iowa for his long-awaited announcement on E15, he heard dire warnings from many of us in the agricultural and biofuel sectors. Updating regulations so retailers can offer E15 year-round represents an incredible opportunity for growth, but farm communities will continue to suffer if the U.S. EPA fails to address the demand destruction of American biofuels.

As regular readers know from Growth Energy's July column, news reports show EPA has been funneling special hardship exemptions to some of the nation’s largest and most profitable refining companies. These exemptions allow firms like Exxon and Chevron to sidestep the nation’s Renewable Fuel Standard and lock billions of gallons of homegrown biofuel out of the marketplace. That means less U.S. energy and higher fuel prices, but it also means EPA has eviscerated the market for nearly a billion bushels of U.S. grain.

For rural families, it’s hard to imagine a worse time to come under attack by Washington bureaucrats. Farm income has been spiraling downward, exports are down, and flooding has demolished hopes for the next harvest in many communities.

But through it all, we know the president was listening. U.S. Agriculture Secretary Sonny Perdue reports that Trump immediately told regulators, “We have got to take care of our farmers. We have got to take care of this.” He then called on the EPA administrator to explain, “How in the world does Exxon Mobil qualify as a small refiner?” That’s the same question Midwest champions such as Sens. Joni Ernst, R-Iowa, Chuck Grassley, R-Iowa, Amy Klobuchar, D-Minn., Deb Fischer, R-Neb., and Tammy Duckworth, D-Ill., have been asking for months.

In response, refiners attempted to silence rural America’s voice in the president’s cabinet. A handful of oil-backed lawmakers threatened Trump’s rural agenda and sought to “prohibit the secretary of agriculture” from advising the president on issues that impact the farm economy. Refiners also aired ads suggesting that secretive refinery handouts were good for jobs. The facts say otherwise, and examples of EPA’s job destruction are piling up.

Across the heartland, 200 ethanol plants are under incredible strain. Many have already shut their doors or idled production as a result of historically low margins, driven lower by EPA mismanagement. Others have sold off assets or warned farmers they can no longer take deliveries. Recent estimates suggest that hundreds of millions of gallons of production remain offline, with plants impacted in Iowa, Illinois, Kansas, Minnesota, Florida, Virginia, Texas, Missouri and Nebraska. Reuters reports that more U.S. ethanol producers could be forced to “sharply curtail production” and Iowa Agricultural Secretary Mike Naig warns that policymakers must act quickly to “heal the self-inflicted wounds that have restricted demand for U.S. biofuels.”

Each time a plant idles production, farmers across the region lose a competitive market for their crops. The impact can be felt across the entire rural economy. That’s why rural champions applauded the president’s ongoing commitment “to support our ethanol industry and to fight for the American farmer like no president has ever fought before.”

But it’s time to go beyond promises and demand action from EPA. We cannot afford another season of demand destruction. That’s why Growth Energy launched a recent ad campaign that puts a face to the farm crisis across the country and gives a voice to those in rural communities who are most impacted by EPA’s failure to follow the law.

The ads spotlight a fourth-generation corn and soybean farmer in Nevada, Iowa, who asks the president to continue listening to rural America: “President Trump has been our greatest champion for ethanol, for family farms, for rural America. We do not want President Trump to be undermined. These unelected bureaucrats at EPA are rigging the system for these oil companies on the backs of family farmers. We hope President Trump will continue to listen to us.”

As I’ve said before, Growth Energy will not allow these exemptions to get lost in the noise while rural communities suffer. But there are already 38 additional refinery exemptions under review by EPA right now, and each one is another bullet aimed at rural growth. We must stand united and keep the pressure on this White House to demand EPA end its corrosive policies.
 


Author: Emily Skor
CEO, Growth Energy
202.545.4000
eskor@growthenergy.org