AUDIO: Mark Recker, President of Iowa Corn Growers Association
AUDIO: Monte Shaw, Executive Director of Iowa Renewable Fuels Association
AUDIO: Grant Kimberley, Executive Director of Iowa Biodiesel Board
The Environmental Protection Agency released the final 2018 Renewable Fuel Standard (RFS) levels for conventional and advanced biofuels, and the 2019 level for biodiesel. It was a mixed bag of opinions, but most ethanol backers were satisfied.
“We are pleased to see the EPA hitting the statutory target for corn ethanol. This comes as good news for Iowa corn farmers who now face tough economic times and for consumers who want affordable, homegrown fuel choices,” Iowa Corn Growers Association President Mark Recker says.
|Total Advanced||4.280 BG||4.290 BG|
|Cellulosic||0.311 BG||0.288 BG|
|Effective Biodiesel Opportunity||3.969 BG||4.002 BG|
|Year-on-year increase||33 million gallons|
The agency finalized a total renewable fuel volume of 19.29 billion gallons (BG), including 288 million gallons (MG) of cellulosic biofuel. That leaves a 15 BG requirement for conventional renewable fuels like corn ethanol, consistent with the levels envisioned by Congress.
“I appreciate the Trump administration maintaining their commitment to the RFS in putting forward these renewable volume obligations. That said, I am disappointed they did not do more, particularly on biodiesel,” Iowa Deputy Secretary of Agriculture Mike Naig says.
“Many people are saying the RFS numbers released today, while disappointing, were expected,” Iowa Renewable Fuels Association Executive Director Monte Shaw says. “I disagree. Based on the 2018 biodiesel level finalized a year ago, biodiesel producers had every right to expect a 100 million gallon increase for 2018.”
Biodiesel groups are not too happy with the biodiesel finalized standards. The Iowa Biodiesel Board says the EPA failed to grow the biomass-based diesel volumes. Since the July proposal was released, IBB has relentlessly called for growth in the volumes of advanced biofuels and biomass-based diesel.
“We believe we will exceed expectations again, but these flat volumes send a weak signal to the market at a time when our plants could significantly increase production and expand capacity. Many plants in Iowa and beyond stand ready to make new investments in boots on the ground and brick and mortar projects, Iowa Biodiesel Board Executive Director Grant Kimberley says.
EPA announced requirements of 4.29 billion gallons of advanced biofuels for 2018 and 2.1 billion gallons of biomass-based diesel again for 2019. The July proposal recommended only 4.24 billion gallons of advanced biofuels and 2.1 billion gallons of biomass-based diesel. This is a reduction and a flatline, respectively, from last year’s standards.
The RFS is a national policy requiring a certain volume of renewable fuel to replace or reduce the quantity of petroleum-based transportation fuel, heating oil or jet fuel. Senator Chuck Grassley wasn’t surprised by the numbers, but they weren’t good enough.
“While I hoped for higher levels, they aren’t unexpected and are unfortunately in line with EPA’s original proposal,” Grassley says.
Grassley continued, “(These) obligations fall short of the full potential of the U.S. biofuels industry. That is disappointing, particularly the lack of increase for biodiesel levels and the cut in cellulosic level requirements.”
“Today, the EPA has upheld their commitment to set the volume requirements for conventional ethanol for 2018 at approved levels, and I am pleased. However, I am disappointed the 2019 biodiesel numbers were held flat at the bare minimum level the Administrator committed to. Moving forward, I will continue pressing the EPA to further bolster the biodiesel and cellulosic requirements,” Senator Joni Ernst says.
The American Petroleum Institute was not pleased today and still wants to see RFS reform.
“The Renewable Fuel Standard is broken and needs comprehensive reform,” Macchiarola says. “Since the RFS was instituted more than a decade ago the U.S. has greatly reduced its dependence on crude oil imports. Administrator Pruitt, therefore, faces the daunting task of implementing a broken program that was based on incorrect assumptions made over a decade ago,” Macchiarola says.
The RFS was created under the Energy Policy Act of 2005 (EPAct), which amended the Clean Air Act (CAA). The Energy Independence and Security Act of 2007 (EISA) further amended the CAA by expanding the RFS program. EPA implements the program in consultation with U.S. Department of Agriculture and the Department of Energy.
“This announcement shows that EPA Administrator Pruitt is listening to our concerns and taking them into consideration. But it also shows that we have more work to do,” Governor Kim Reynolds says.
Pruitt plans to visit Nevada, Iowa Friday.