The U.S. Senate is holding hearings to approve Scott Pruitt as administrator of the U.S. Environmental Protection Agency (EPA). A broad coalition of Iowa farmers, renewable fuel producers, and retailers are urging Pruitt to protect the Renewable Fuel Standard. They sent him a letter February 16 asking him to reject the petition to change the successful program’s point of obligation. The request would change the RFS obligated parties from mostly large petroleum refiners to many fuel retailers.
Under the Obama Administration, the EPA proposed to reject the request, but the public comment period on the proposed rejection is still open meaning the final decision will be up to President Donald Trump’s EPA. Iowa entities urging Pruitt to finalize the pending rejection include Iowa Renewable Fuels Association (IRFA), Iowa Corn Growers Association (ICGA), Petroleum Marketers and Convenience Stores of Iowa (PMCI), Iowa Biodiesel Board (IBB), Truckstops of Iowa, and fuel retailer Kum & Go.
Working for energy independence
“We have a slogan in the renewable fuels family that says ‘Don’t mess with the RFS,’” says IRFA executive director Monte Shaw. “Let me make this perfectly clear: changing the point of obligation is most definitely messing with the RFS in a significantly harmful manner. Iowa’s ethanol and biodiesel producers oppose it and will fight hard to defeat it. We are calling on the Trump Administration to uphold the President’s commitment to protect the RFS.”
“We thank President Trump for supporting the corn and ethanol industry and for recognizing the RFS's impact in stabilizing our rural economy, creating American jobs and energy independence,” says ICGA president Kurt Hora, a farmer from Washington, Iowa. “With massive corn surpluses and corn prices below the cost of production, the last thing farmers need is disruption in a key market. Therefore, we remain committed to ensuring the RFS’s point of obligation be maintained.”
RFS helps create American jobs
“The RFS was designed for one set of circumstances, one that involved a manageable number of obligated parties to work with the EPA. To change the point of obligation at this time, simply because certain businesses chose Wall Street over the regulation, would be devastating to the wholesalers and retailers who have invested heavily in supporting the RFS and everything it stands for,” says Dawn Carlson, president and CEO of the Iowa petroleum marketers organization. “Moving the point of obligation would pull thousands of companies into this requirement ultimately impacting consumers negatively as pricing dynamics at fuel terminals would change.”
“The Trump Administration has made American manufacturing and jobs a top priority, and the RFS is a shining success story in that regard,” says Grant Kimberley, Iowa Biodiesel Board executive director. “Rocking the boat now based on a few vocal self-interested detractors could cause disastrous upheaval for this program, which is working as an economic driver in Iowa and beyond. We support the wholesale fuel providers who have worked for years to commit to biodiesel and the RFS. We agree with EPA, which is on record that the current structure of the RFS program is working to incentivize the production, distribution and use of renewable transportation fuels in the U.S., while providing obligated parties a number of options for acquiring the RINs they need to comply with the RFS standards.”
Don’t create chaos and delay
Delia Moon, president of Truckstops of Iowa, emphasizes: “It does not make sense to change the monitoring of renewable fuel use from 50 large refiners to 100,000 or more independent retailers. Changing the point of obligation will create a significant bureaucratic burden on these retailers and it will be an auditing nightmare for EPA.”
Quad County Corn Processors, a farmer-owned ethanol production plant in western Iowa, is currently the largest cellulosic ethanol producer under the RFS. Quad’s CEO Delayne Johnson adds: “Changing the point of obligation 11 years into the program would create unnecessary chaos and delay. It would essentially push pause on the program for more than a year, which would undermine investments in cellulosic ethanol.”
Western Dubuque Biodiesel general manager Tom Brooks concludes: “As a young industry competing against the entrenched petroleum industry that has benefited from more than 100 years of federal tax preferences, biodiesel needs stability in the RFS and the RIN market. Moving the point of obligation invites only uncertainty and confusion.”
Comment period ends Feb. 22
The public comment period on the proposed rejection of the petition to change the point of obligation closes on February 22, 2017. After reviewing the public comments, the Trump administration’s EPA will make the final decision.
The Iowa Renewable Fuels Association represents Iowa’s renewable fuels industry and works to foster its growth. Iowa is the nation’s leader in renewable fuels production with 43 ethanol refineries capable of producing 4 billion gallons annually – including nearly 55 million gallons of annual cellulosic ethanol production capacity – and 12 biodiesel facilities with the capacity to produce over 350 million gallons annually. For more information, visit the Iowa Renewable Fuels Association website at: www.IowaRFA.org.