Coalition urges lawmakers to 'stay the course' on RFS

By Holly Jessen | October 22, 2012

A coalition of seven biofuel trade associations sent a letter to leaders in the U.S. House of Representatives and Senate, urging them to “stay the course” on the renewable fuel standard, as they review a range of options for providing drought relief. “We are writing to caution against any legislative changes to the renewable fuel standard policy, and ask your support in urging the U.S. EPA not to grant any waivers of RFS requirements.”

Those that signed the letter, which was sent Oct. 18, include representatives from the Advanced Ethanol Council, the Algae Biomass Organization, the American Coalition for Ethanol, the Biotechnology Industry Organization, Growth Energy, the National Biodiesel Board and the Renewable Fuels Association. “A number of groups and some governors have asserted that the RFS is a substantial part of the equation when it comes to grain prices, and they believe waiving the program this year or next will ease the impact of the drought on consumers,” he letter said. “There is substantial evidence to the contrary.”

The letter had four main points:

  1. Waiving the RFS wouldn’t have a significant impact on grain prices.
  2. Changes to the RFS would weaken the U.S. commitment and increase gas prices.
  3. It will slow investment in the advanced biofuels industry.
  4. The RFS provides a foundation to drive investment in a biobased economy and waiving would destabilize “a cornerstone of the U.S. economic recovery.”

The flexibility already built into the RFS and the market itself are already working to minimize the consumer impact of the drought, the letter said. According to the EPA, thre are currently 3 billion excess credits for blending obligations met in previous years, which can roll over to meet current requirements. In addition, the ethanol industry is producing 15 percent less than it produced at the beginning of the year, due to temporary shutdowns or by cutting production rates. “Recent calls to alter or suspend the RFS, which sometimes well-intentioned, are misguided and may actually worsen the consumer impacts of the drought,” the letter said.

Separate from Congress considering options for drought relief is the fact that the EPA is currently reviewing a waiver request. The comment period ended Oct. 11. The EPA has 30 days to respond, although it’s possible that time period could be extended.