RFS rule still leaves corn ethanol in play

Today the Environmental Protection Agency (EPA) announced details of the newly-expanded rule for the Renewable Fuels Standard (RFS) which does recognize that ethanol from all sources provides significant carbon benefits compared to gasoline. However ethanol supporters are concerned of the agency's use of the indirect land use change theory which puts corn-based ethanol at a disadvantage to other biofuels such as Brazilian sugar-based ethanol.

According to EPA's modeling, corn-based ethanol achieves a 21% greenhouse gas reduction compared to gasoline when international indirect land use change (ILUC) are included. Without ILUC, corn-based ethanol achieves a 52% GHG reduction. Cellulosic ethanol achieves GHG reduction of 72-130% depending upon feedstock and conversion process. All GHG reductions for ethanol exceed those mandated by the RFS2.

National Corn Growers Assoc. (NCGA) President Darrin Ihnen said this means that all corn ethanol including existing grandfathered capacity and new production will qualify to meet the conventional biofuels targets in the RFS.

EPA did change its indirect land use change penalty from its original proposal last year. However ethanol groups state the ILUC should not be applied in regulation until there is a more thorough, long-term study on the issue. The House's version of climate change legislation called for the study, a measure pushed by House Agriculture Chairman Collin Peterson, (D., Minn.).

Peterson joined House Armed Services Chairman Ike Skelton (D., Mo.) and Rep. Jo Ann Emerson (R., Mo.) to introduce a bill this week to prevent EPA from regulating greenhouse gas emissions under the Clean Air Act. The bill, H.R. 4572, also includes provisions that would stop the EPA from using international indirect land use calculations in biofuels regulations and would expand the definition of renewable biomass.

Ihnen stressed that the EPA should reject the "unproven theory of international indirect land use change, which assumes that growing more corn means planting corn on a proportionately greater amount of acreage and will impact other crops or natural resources on a global basis. Today's yield trends show this to be false. 2009's record corn yield was 165.2 bushels per acre, according to the U.S. Department of Agriculture, more than 11 bushels higher than 2008 and nearly 15 bushels higher than 2007," a statement from NCGA said.

Tom Buis, Growth Energy CEO, said the rule gives Brazilian sugarcane ethanol "preferred status as an advanced biofuel" which he said he doubts was the intent of Congress when it passed the Energy Independence and Security Act. "It won't make the U.S. any more energy independent by switching our addiction from foreign oil to foreign ethanol," he said.

Buis did note several improvements to the rule from when EPA first proposed the expanded RFS last year.

"We're pleased with the decision to make volume levels of domestic ethanol retroactive to the first of the year - this is a significant step toward reducing dependence on foreign oil, creating U.S. jobs and improving the environment," Buis said.

President Barack Obama also unveiled a report by his Biofuels Interagency Working Group, created last Spring to support the biofuels industry to create new jobs, greater economic vitality and increased energy independence.

"With the policies he's laid out today, President Obama is adding muscle to the bone by investing in new technologies, reforming the loan guarantees for cellulosic ethanol to encourage the development of this cutting-edge fuel, and equipping government facilities with Flex Fuel Vehicles. Each of these steps help address many of the challenges and opportunities we have to reduce our dependence on foreign oil, create U.S. jobs and reduce greenhouse gas emissions," Buis said.

source: feedstuffs