EPA receives additional letters about drought, RFS waiver

By Holly Jessen | August 24, 2012

On Aug. 22 three state governors sent letters to the U.S. EPA about the renewable fuel standard—one requesting that the RFS remain in effect and two asking for a waiver.

Iowa Gov. Terry Branstad’s letter said that he has seen the positive impacts that the RFS has had in Iowa and the nation. Maintaining the RFS something Branstad strongly believes is essential for ensuring robust food and energy supplies as well as a strong economic future, he said, adding that he doesn’t believe that the facts warrant an RFS waiver at this time. “It is not sound policy to address uncertainty in one component of the agricultural economy by increasing uncertainty in another component,” he said. “Especially, as in this case, when the benefit to livestock producers is uncertain and the nation’s renewable fuel industry will be negatively impacted. While the drought has presented livestock producers with challenges, a waiver to the RFS is not an appropriate response.”

The more than 900-word letter addressed a variety of reasons Branstad doesn’t believe a waiver would be a good idea. It could send the signal that U.S. renewable fuels policy is risky and slow investment, which would slow the advancement of advanced biofuels commercialization, for one. He also pointed to the fact that one-third of the corn that goes into ethanol plants leaves as distillers grains for animal feed. “Distillers grains decrease demand for corn and soy meal for livestock feed,” he said. “Federal policy should support value‐added opportunities and diversification of agricultural products.”

Although it is true that the drought is a hardship for farmers and livestock producers, steps are being taken to ease those burdens on the state and federal level. “National policy makers should avoid short‐term actions that increase uncertainty in a national economy that already is unstable,” he said.

Gov. Susana Martinez of New Mexico and Gov. Nathan Deal of Georgia, on the other hand, sent letters Aug. 22 asking the EPA to waive the RFS. They are the fifth and sixth governors to make the request, according to an American Meat Institute press release. However, the Renewable Fuels Association has said not all those requests count as official waiver petitions. Arkansas Gov. Mike Beebe and North Carolina Gov. Beverly Perdue filed the official petitions in mid-August. The other two governors that have made waiver requests include Martin O’Malley of Maryland and Jack Markell of Delaware.

The letter from Martinez says, “To help alleviate the negative impacts caused by the severe drought conditions, I urge you to consider granting an immediate waiver from the RFS. Approving this waiver would help ease the burden of increased feed costs, food products supply and the continued hardships current economic conditions are inflicting on producers and consumers alike.”

Deal’s letter asked the EPA to waive the RFS promptly to assist poultry and livestock producers. He pointed out that poultry and livestock represents more than 50 percent of the state’s farm value, with 40 percent coming from broiler production. Nationally, Georgia ranks No. 1 in broiler production and third in value of eggs produced. “The poultry industry cannot operate their business profitably given these very high input costs,” the letter said. “Forecasts are now for negative operating margins for poultry and a continued decline of broiler production in coming months.”

Although no longer in office, former lawmakers Stephanie Herseth Sandlin, who represented South Dakota in the U.S. House of Representatives, and Tom Ewing, a past member of the Illinois’ 15th Congressional District, came out in support of the RFS in an opinion piece published Aug. 21 in the Politico

The current members of the Steering Committee of the 25x’25 Alliance said altering the RFS would have “drastically negative consequences in the long run.” They pointed to three realities, including the fact that producing less ethanol would not mean cheaper corn, that the RFS and biofuels production are both essential to move the U.S. away from importing foreign oil and that the nation is about to begin commercially producing biofuels from non-food feedstocks. “Granting any waiver based solely on political expediency would be inappropriate,” they wrote. “Indeed, that would pile disaster upon disaster for the very communities suffering from the drought, putting us on a path of undoing the RFS’s work longer-term. If our priority is helping rural America and continuing to enhance our energy security, we must prioritize protecting the RFS.”