EPA administrator Scott Pruitt quelled midwestern protests over a potential change in course by the Trump administration, saying there would be no additional cuts in the biofuels mandate proposed for 2018. But two groups, the National Biodiesel Board and the Iowa Renewable Fuels Association, said the government ought to raise the target for biodiesel.
The Midwest is the heartland of U.S. ethanol and biodiesel production. Two of the three commercial-scale cellulosic ethanol plants in the nation are in Iowa, the No. 1 corn and ethanol state. State officials, farm groups and allies in Congress expressed mounting concern in recent weeks over proposals to reduce the biodiesel target and to water down the ethanol mandate by counting exports toward domestic energy independence.
President Trump rolled up huge vote margins in rural America in 2016, partly with his promises of tax reform and regulatory relief and support for corn ethanol.
In a letter to senators from the Plains and Midwest, Pruitt said EPA’s preliminary analysis suggested the 2018 Renewable Fuel Standard “should be set at amounts that are equal to or greater than the proposed amounts.” EPA’s decision is due by Nov. 30. In July, the agency proposed a corn ethanol mandate of 15 billion gallons, the same as this year. The biodiesel mandate would be 2.1 billion gallons, a 100-million-gallon increase from this year, with EPA penciling in a 2.1-billion-gallon biodiesel mandate for 2019 as well.
“We cannot settle for the biomass-based diesel volume remaining flat as 2.1 billion gallons,” said Doug Whitehead of the National Biodiesel Board, which says the industry already has the capacity for 2.6 billion gallons a year. “We are going to work closely with the EPA and the White House to help them understand that a robust biodiesel industry is what the law requires.”
In July, the EPA said it would use its discretion to lower the target for cleaner-burning “advanced” biofuels, which include biodiesel and cellulosic ethanol, made from crop debris, grass and woody plants. Biodiesel accounts for nine of every 10 gallons of advanced biofuels. Other renewable fuels, such as cellulosic, are years later than expected in reaching commercial volumes.
“To live up to the letter and spirit of the RFS in the final rule, the EPA must increase levels for biodiesel and cellulosic ethanol from what was proposed in July,” said Monte Shaw of the Iowa RFA.
Pruitt’s letter resolved one irritant of the ethanol industry — a proposal to change the “point of obligation” for blending ethanol and other renewable fuels into petroleum. Refiners now have that duty and Pruitt said that, “after detailed analysis,” it would not change. The EPA chief also said the agency is actively exploring whether it can approve year-round sale of E15, a 15 percent blend of ethanol into gasoline. The traditional blend is 10 percent. The letter also put the kibosh on letting ethanol exports count toward satisfying the RFS.
Two large biofuel trade groups welcomed the Pruitt letter as a signal of administration intent. “Administrator Pruitt should be commended for following through on President Trump’s commitment to biofuels and the RFS,” said Iowa Sen. Chuck Grassley.