Renewable Fuel Standardby Senator Richard J. Durbin
Posted on 2013-12-18
DURBIN. Mr. President, today, I, along with several other
Senators, will be meeting with EPA Administrator McCarthy concerning a
proposal from EPA to waive the renewable fuel standard, or RFS. If the
proposed rule is made final, it would undermine one of the biggest
policy tools we have to support energy independence, to lower
greenhouse gas emissions, and stabilize our rural economy.
The renewable fuel standard was created in 2002 to drive growth in the biofuels industry. Why is that so important? When biofuels are contributing to our domestic fuel supply, we use less petroleum-based energy. Gasoline blended with ethanol burns more cleanly, so cars are generating less greenhouse gas; And with a steady, predictable market for biofuels, there is now a healthy biofuels industry that supports hundreds of thousands of jobs.
Each year the Environmental Protection Agency sets volume standards for renewable fuels that requires refiners to blend certain levels of biofuels into the fuel supply. RFS levels have been steadily increasing by law since Congress updated the renewable fuels effort in 2007.
The renewable fuel standard has worked well. The United States needs to be less reliant on other countries for its energy. Growth in the use of biofuels--particularly corn-based ethanol--is one of the few, meaningful steps we have taken. And it is working. Last year, we used 13.3 billion gallons of ethanol to displace 465 million barrels of oil. That is 12 percent of the total U.S. crude oil imports.
Not only do biofuels play an important role in energy independence, they have the added benefits of being good for the environment. The renewable fuel standard promotes the adoption of biofuels explicitly because they reduce greenhouse gas emission.
Many of my colleagues may know that in Illinois we grow a lot of corn. Not surprisingly, we also happen to be one of the largest producers of corn-based ethanol--the biofuel most often cited as not being as ``green'' as other biofuels. But even ethanol is required to reduce greenhouse gas emissions by 20 percent.
A recent study by Argonne National Lab found that, on average, ethanol reduces greenhouse gas emissions by 24 percent. In 2012, ethanol reduced emissions from cars and trucks by 33.4 million tons. That is the equivalent of taking 5.2 million cars off the road.
[[Page S8973]] But it is not just ethanol. Advanced biofuels reduce greenhouse gas emissions even further. They are required to reduce greenhouse gas emissions by at least 50 percent. That is why groups like the American Lung Association have supported the development and use of biofuels. And while many advanced biofuels are just beginning to come online, others--like biodiesel--are getting closer to really hitting their stride.
An added benefit of growth of biofuels in States like Illinois is the effect it has had on our rural economy. The use of biofuels has helped create an additional market for crops, but it also has created an emerging industry in rural communities. There are now 14 ethanol plants and 5 biodiesel plants operating in Illinois. Steady biofuels production in Illinois means new jobs in communities that were having trouble economically even before the recession. Those 14 ethanol plants have led to 5,400 direct jobs in Illinois and payroll exceeding $250 million.
EPA issued a draft rule last month that would waive the statutory RFS levels for 2014 below levels even required in 2012. By waiving the standard as proposed, the rule not only threatens the current biofuels industry, but it will significantly slow or stop more advanced biofuels coming to the market. In effect, what EPA has proposed would stop any new growth in the industry.
Today, most gasoline is blended with 10 percent ethanol, more commonly referenced as E-10. Some think of this level as a ``blend wall'' because to increase the blend ratio, we need more investment in infrastructure like gas pumps that deliver it. But if we get stuck at E-10, that effectively shuts down for many biofuels. Corn-based ethanol already is produced at levels to completely saturate the market at E- 10, leaving little room for growth advanced cellulosic ethanol.
Part of the reason for creating the RFS was to help create incentives to push past barriers like the blend wall. EPA has already approved a pathway to doing just that in the form of E-15. But instead of using RFS to help push through infrastructure hurdles to biofuel growth, EPA's proposal would enshrine this market barrier as the true ceiling for much of our biofuels growth.
And EPA's proposed rule is already reverberating through the market. Investments in biofuels, particularly advanced biofuels, are already starting to slow, based on the proposed rule. I heard from a company in Illinois that had recently announced new investments in their plant. They are now re-thinking their expansion plans. That means if EPA's proposed waiver is adopted, we may never realize the full benefits of RFS that Congress intended. We will freeze our progress on reducing greenhouse gas emission. We will limit a tool in securing our energy independence. And we will stymie the growth of an industry that is playing an important role in rural economies.
That is why I am working with like-minded Senators on both sides of the aisle to urge the EPA to reconsider this rule before it is finalized. We have come too far to take this giant step backward. Biofuels are an important part of our energy future and the right path for our country.