Ag Policy Blog
Chris Clayton DTN Ag Policy Editor

Thursday 03/14/13

Governors Call on Congress to Protect RFS
The Governors' Biofuels Coalition that includes the governors of 33 states has appealed to Congressional leaders to leave the Renewable Fuels Standard as it is, amid growing pressure from the oil industry and other interests to either alter the law that calls for 36 billion gallons of biofuels use by 2022 or to scrap the law altogether.[Read Full Blog Post]
Posted at 1:26PM CDT 03/14/13 by Todd Neeley | Post a Comment
Comments (8)
What Others Say A diverse group of individuals and organizations from a variety of interests�and both ends of the political spectrum�have raised concerns about the RFS and government-imposed ethanol mandates. This includes research organizations, academic institutions and numerous business, taxpayer, hunger, agricultural, free-market, religious, environmental and public interest groups. Here is a snapshot of conversation around the RFS and biofuels from the government, business, media, academic and NGO communities: Government �Such (higher ethanol) blends reduce a vehicle's fuel economy (i.e., fewer miles per gallon) and may cause older automobiles to experience higher emissions of pollutants and catalyst temperatures.� � Government Accountability Office �What I've said is my top priority is making sure people are able to get enough to eat. If it turns out we need to make changes in our ethanol policy to help people get something to eat, that has got to be the step we take.� � President Barack Obama �Americans need a fuel that will get more miles per gallon and extend the lives of their cars. But if the Environmental Protection Agency is successful, we soon will be fueling with a higher blend of ethanol. The increased ethanol blend will harm vehicle engines, lower fuel efficiency and void warranties. It also will destroy the engines in many boats, lawn mowers and tractors.� � Rep. Jim Sensenbrenner (R-Wis.) "Now we know that biofuels, intended to promote energy independence and combat climate change, are frequently energy inefficient. We need to look closely at the impact on food prices and the environment of different production methods and to ensure we are more selective in our support.� � Former U.K. Prime Minister Gordon Brown Business "Ethanol use does little to prevent global warming and environmental deterioration, and clear-headed policy reforms could be urgently carried out, if American politics would permit it." � Amartya Sen, Nobel Prize-winning economist �Increasing ethanol in gasoline could cause serious engine damage and as a result, auto manufacturers have stated that they will not warranty engines of their vehicles if gasoline containing more than 10 percent ethanol is used. This leaves consumers at risk of having to pay costly repair bills.� � American Fuel & Petrochemical Manufacturers �Washington has propped up ethanol through subsidies, sweetheart tax deals, mandates and other schemes. The EPA shouldn't encourage this dash for cash even further by using its authority to expand E15�s usage.� � Pete Sepp, National Taxpayers Union "Intelligence won out in [the ethanol subsidies] case. [It took] an IQ of 80' to realize it was a bad idea" �Bill Gates, Microsoft �The EPA is now on a very, very bad course to cause a major spike in gasoline prices based upon a program that was silly in the first place�the whole idea of turning food into fuel...The price of [RIN credits] has gone from a nickel per gallon to a dollar per gallon�but since this Frankenstein monster keeps getting larger, what will happen is these RINs keeping going up in price, either forcing the price of gasoline to skyrocket for consumers or forcing the refiners to send all of their product overseas, decreasing supply, also skyrocketing the price of gasoline.� � Dan Dicker, MercBloc LLC Media �If we're serious about cutting wasteful spending and reining in government, the abolition of subsidies for ethanol production and the ending of mandates for its use would be a good place to start.� � Investor�s Business Daily editorial �Congress subsidized a product that didn't exist, mandated its purchase though it still didn't exist, is punishing oil companies for not buying the product that doesn't exist, and is now doubling down on the subsidies in the hope that someday it might exist. We'd call this the march of folly, but that's unfair to fools.� � Wall Street Journal editorial "You don�t have to be an economist to understand why the ethanol sector is driving food prices higher. This year, about 4.3 billion bushels of corn will be converted into motor fuel. That means that nearly 37 percent of this year�s corn crop will be diverted into ethanol production...But what makes the ethanol charade even more perverse is that the entire rationale for ethanol has evaporated. For decades, the bogeyman of foreign oil has provided a handy canard that the ethanol industry could use to justify its subsidies and mandates. No longer. Foreign energy is becoming increasingly irrelevant to the United States." � Slate editorial "Where the effects of bad policy are clearest, however, is in the rise of demon ethanol and other biofuels. The subsidized conversion of crops into fuel was supposed to promote energy independence and help limit global warming. But this promise was, as Time magazine bluntly put it, a 'scam.'" � New York Times editorial "Ethanol is one of the only products in history that Congress subsidizes and mandates at the same time." � Wall Street Journal editorial "The fix here is obvious. The EPA has the authority to revise the ethanol requirements, and if it did so tomorrow the price of gas would quickly fall by about five to 10 cents a gallon. If EPA won't act, Congress can and should suspend the ethanol blending mandate to give motorists a break." � Wall Street Journal editorial Academic �Currently, no commercially viable biorefineries exist to process cellulosic materials into fuel.� � National Academy of Sciences �The U.S. biofuels program is a huge blow to the world food supply.� � Jeffrey Sachs, Director of The Earth Institute, Columbia University �Policies to increase biofuels production and use retard the developing world�s progress against reducing poverty levels and would exacerbate their burden of death and disease.� � Journal of American Physicians "In short, expansive renewable fuel mandates are a bad bet for consumers, doing little for energy security while risking food security, harming the environment and raising costs throughout the economy." � John DeCicco, Energy Institute and School of Natural Resources and Environment, University of Michigan NGO �Ethanol production has been subsidized for more than 30 years, and the cost to taxpayers is sharply growing. Over the next five years, biofuels businessmen could line their pockets with nearly $40 billion from U.S. taxpayers. The industry doesn�t need these tax credits. Federal regulations have handed the companies a guaranteed market due to consumption. If these businesses can�t make a profit on their own, maybe they shouldn�t be in business.� � Erich Pica, Friends of the Earth �The average Guatemalan is now hungrier because of biofuel development� -- Katja Winkler, a researcher at Idear, a Guatemalan nonprofit organization that studies rural issues �Corn ethanol has not only been a disaster for consumers, the hungry and for most farmers, it has also been a disaster for the environment. We have lost more wetlands and grasslands in the last four years than we have in the last 40 years.� � Scott Faber, Environmental Working Group
Posted by Lon Truly at 7:54AM CDT 03/15/13
We don't need to,and with the drought and population growth we shouldn't use farm land to grow fuel. There are better options,for energy like, Low-cost ethanol from hydrocarbon feedstocks ( http://www.celanesetcx.com/en/tcx-benefits/safe-clean ) and then there's Safe, new, nuclear- http://www.terrapower.com,that Bill Gates promotes,and could be tied with http://www.airfuelsynthesis.com/ and also produce carbon free energy for electric cars. Also, /www.proterro.com/ that makes the sucrose instead of extracting it, lowering the cost of sugar for the economical and scalable production of biofuels. We really should support and fast track these options for a cleaner,healthier planet, and for the best future for America and the world. But the RFS mandates take away resources(money,research) and stifles better options by forcing us to use billions of gallons,of corn ethanol and other land source energy.
Posted by stan s at 8:16AM CDT 03/15/13
How about the most sensible and simplest method. Reduce your trips to the mall or where ever, turn off the lights your not using, walk- do not ride? Jimmy Carter wasn't that unpopular, was he!!!!
Posted by Bonnie Dukowitz at 9:25AM CDT 03/15/13
Do you realize what the what the price of corn would be if it wasn`t for ethanol. Corn would be $2 & beans $5. So you guys be careful what you ask for!!!!! The govt needs to feed the poor people in this country first instead of the people who don`t care about us. SO WAKE UP Lon & Stan!!!!!!
Posted by KEITH PEARSON at 7:36PM CDT 03/16/13
If you are so concerned about feeding the poor in this country Keith it is a whole lot easier to do when corn is $2 and soybeans are $5 as less people are on food stamps then and other food costs for the poor are a whole lot less. Sounds alot to me Keith that you are not all that interested in seeing the poor in this country or anywhere else be fed.
Posted by Lon Truly at 4:15PM CDT 03/17/13
Lon you`re a moron. If grain got that low you would be out of buisness. That is if you are truly a farmer. you would never be able to aford the input cost. Input cost never come down as fast as grain prices do. As far as me not caring about feeding the hungry you are totaly wrong about me. I have been through the hard times & know what it is like not to have money to feed your family, so be careful where you go with this!!!! There is alot of fraud with the food stamp program thanks to Obama programs. As far as the rest of the world why feed them when thy are wanting to kill us for what we believe in.
Posted by KEITH PEARSON at 6:43PM CDT 03/17/13
Try educating yourself Pearson - See http://www.econlib.org/library/Enc/CreativeDestruction.html
Posted by Lon Truly at 8:21AM CDT 03/18/13
You`re the one who needs to get educated. I wish you were farming in my area, I would educate you in a hurry. So if I hit a nerve Lon that is good, I am sure I did!!
Posted by KEITH PEARSON at 9:10AM CDT 03/18/13
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