Why The Ethanol And Petroleum Industries Are Unhappy With The New Renewable Fuel Standard

As climate talks got under way in Paris last week, the Environmental Protection Agency announced its final rule on how much corn ethanol and advanced biofuel will be blended in the U.S. fuel supply in 2016. EPA’s rule finalizes higher volumes of renewable fuel than those the agency proposed earlier this year and is garnering criticism from fuel industry groups that had worked to influence its outcome.

The agency’s blend requirements for renewable fuels in 2016 is 68.55 billion L, which is lower than the target set by Congress in the 2007 Energy Independence & Security Act. In comparison, the standard for 2015 is 64.09 billion L.

Groups representing ethanol producers and petroleum companies disparaged the new Renewable Fuel Standard (RFS)—the former arguing that the level for ethanol is too low, and the latter claiming it is too high.

“As the U.S. enters negotiations with the rest of the world to limit greenhouse gas emissions, EPA is putting in place an RFS rule that will sacrifice achievable reductions of emissions in the transportation sector,” says Brent Erickson, executive vice president at the Biotechnology Industry Organization.

But Jack Gerard, CEO of the American Petroleum Institute, says, “EPA’s final rule relies on unrealistic increases in sales of higher ethanol fuel blends despite the fact that most cars cannot use them.”

Renewable fuel standards are intended to promote energy independence and address climate change and are set by EPA.