WASHINGTON — If the biofuel industry were your family car, you'd tell the mechanic that the transmission is slipping. Backward, forward, reverse again, it's enough to give you whiplash.
The latest shifts come from Washington where the Trump administration drew criticism for steadily increasing its number of Renewable Fuel Standard waivers granted to small refineries since 2016, thus depressing the need for American-made biofuels.
In a year where Midwestern ethanol plants are closing and farmers are up against a brutal agriculture economy, the White House's waivers, which ultimately dropped the volume of biofuels blended into U.S. supply by 4.04 billion gallons, were unwelcome.
Reversing course, the White House sought to make amends earlier this month with a new ruling that would expand biofuel requirements, which the Minnesota Corn Growers Association called a "positive first step."
But the EPA's proposed rule released on Oct. 15 hit the brakes: Under the rule, the EPA will calculate the volume of biofuels U.S. refiners must blend based on three-year averages of exempted gallons, according to Department of Energy recommendations.
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The EPA is not seeking to change proposed renewable fuel targets for 2020 and 2021. Instead, the agency is proposing adjustments to the way it sets annual percentage requirements, which are used to calculate how many gallons of renewable fuel individual refiners and importers must blend.
Refiners that don't meet the targets independently can still satisfy them through tradeable credits known as Renewable Identification Numbers that are generated when biofuel is blended into gasoline and diesel.
Kevin Ross, president of the National Corn Growers Association, said "the proposed rule fails to provide the assurance needed that EPA’s practices for granting waivers will change going forward. Farmers have long been skeptical of the EPA’s administration of the RFS."
Ethanol and biofuel advocates say waivers issued to small refineries, exempting them from blending their gasoline with the biofuel, have taken 4 billion gallons out of the system. That has reverberated down the pipeline and biofuel plants in some rural communities have closed their doors, leaving farmers with nowhere to take their crops and workers without jobs or paychecks.
Monte Shaw, executive director of the Iowa Renewable Fuels Association, told reporters in a conference call Oct. 16 that the EPA had gone back on the deal Trump laid out.
"When Donald Trump makes a deal, isn't it a deal," Shaw asked. "There's nothing in here that will prevent more plants from closing."
A public hearing on the proposed rule will be held Oct. 30 in Washington, D.C., and a 30-day public comment period will follow before it is finalized.
