Texans push feds to change biofuel quotas

WASHINGTON — From Democratic Rep. Joaquin Castro to a Fredericksburg RV enthusiast, Texans are weighing in on the Obama administration’s proposal to slash the amount of biofuels that must be blended into the nation’s gasoline supply.

Their written remarks joined thousands more streaming in from across the United States — including the corn belt and the oil patch — as the Environmental Protection Agency accepts public comments on its proposed renewable fuel quotas for 2014. The window for submitting those public comments closes at midnight Tuesday evening.

Federal law requires U.S. refiners to incorporate an annually increasing volume of biofuels into the nation’s diesel and gasoline supply, up to 36 billion gallons by 2022. The EPA, which sets the annual quotas, has proposed requiring refiners to use 15.2 billion gallons of renewable fuels in 2014, some 3 billion below the amount mandated by statute.

Corn belt concerns

Texas corn growers think that’s a bad idea.

In a written comment filed with the EPA, Jimmy Wedel, president of the Lubbock-based Corn Producers Association of Texas, said the proposed cutbacks “would have detrimental implications for American consumers, farmers, businesses and both national and regional economies.”

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Wedel suggests that lowering the quotas for corn-based ethanol — a move that would decrease demand for the crop — could encourage Texas farmers to shift to other plants.

“If corn is not a viable business option for Texas farmers, they will look to growing other crops such as cotton or sorghum, increasing the supply and depressing the prices of those commodities,” Wedel told the EPA. “It creates a downward spiral in income for America’s hardworking farmers while enriching the profits of foreign oil producers. All the while, it weakens economies of the communities and cities dependent on American agricultural production.”

Advanced biofuels

Sorghum producers in Texas also want the EPA to change course — by upping the mandated amount of advanced biofuels. The EPA specifically proposed requiring 2.2 billion gallons of advanced biofuels be used in 2014, well below the 3.75 billion laid out in federal law.

J.B. Stewart, chairman of the National Sorghum Producers, based in Lubbock, said current production of domestic advanced biofuels suggests the target should be closer to the 3.75 billion-gallon benchmark.

If the required volumes for advanced biofuels are set too low — without providing “for current production and continuing growth” — the EPA “will put a damper on current and future investment in advanced biofuels,” Stewart said.

Grain sorghum-based ethanol production using biogas and combined heat and power is expected to produce about 50 million gallons this year, Stewart said.

 Ethanol’s blend wall

In proposing to reduce the required volumes for 2014, the EPA was responding to the oil industry’s fears of hitting a “blend wall,” when the mandates would force them to mix a higher proportion of ethanol into fuel than the 10 percent approved for use in all cars and trucks. That point has arrived sooner than policymakers anticipated partly because of declining gasoline demand.

Texas boaters and motorists urged the EPA to stick with its plan to reduce ethanol volumes. At least two drivers said they have seen gas mileage decline as the ethanol in gasoline has climbed.

“Since we now have 10 percent ethanol in our gasoline in Texas, our gas mileage on both of our older vans dropped from 28 to 29 miles per gallon to 22 to 25 miles per gallon,” said Ann Odom of Chireno, Texas.

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Charles Reaves, who lives in Fredericksburg, Texas, recalled taking a road trip with his recreational vehicle to Florida. Reaves initially filled up with ethanol-free gasoline and said he got about 17 miles per gallon of fuel. But as the trip progressed — and he started filling up with higher ethanol blends — Reaves said he saw his mileage drop to 14 miles per gallon.

Biofuel advancements

Castro, who represents San Antonio in the House of Representatives, says the EPA should use all of its existing powers under federal law to adjust the 2014 quotas “to avoid potentially negative impacts on our environment and economy,” while still maintaining “our progress toward the development of commercially available renewable energy sources.”

Biofuel boosters stress that the federal renewable fuel standard was meant to drive innovation and spur new options for fueling the nation’s trucks and cars.

Tom Buis, CEO of Growth Energy, told the EPA in comments filed Tuesday that its proposal to slash mandates in 2014 “threatens to undermine the success of the RFS by not only halting future progress, but, in fact, rolling back gains made to date.”

“The proposal would also undermine billions of dollars of investments made by biofuel producers in order to do their part under the RFS,” Buis said. “It would halt future investments in the next generation of biofuels and increase greenhouse gas emissions.”

‘Overly optimistic’

Oil industry groups want changes too; they want the EPA to make more cuts to this year’s biofuel quotas.

Specifically, the American Petroleum Institute and the American Fuel and Petrochemical Manufacturers told the EPA that its proposed quota for cellulosic fuels — 17 million gallons in 2014 — is “overly optimistic.” Cellulosic biofuels are made from switchgrass, wood and other inedible plant parts.

The quota for cellulosic fuels appears to be based on overly rosy estimates of production that will not be realized, the groups said in joint comments filed late Tuesday.

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The groups asked the EPA to require 2 million gallons of cellulosic biofuels in 2014 — down from the proposed 17 million-gallon quota and the 1.75 billion-gallon benchmark in federal law.

“Because of the overly optimistic projections for cellulosic biofuel, we continue to recommend that EPA finalize the cellulosic volume standard as an annualized average based on the most recent 3 months of cellulosic biofuel production,” the organizations said.

Overall, the API and AFPM asked the EPA to lower the total renewable fuel requirement to 14.8 billion gallons in 2014 (down from the 15.21 gallons that the agency proposed).

That would “fully address the blend wall issues and will avoid significant economic harm,” the groups said.

API Afpm Rfs

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