What a Weakened RFS Program Means for the State of Iowa and this Country

0383584By Joe Hrdlicka, Executive Director of the Iowa Biotechnology Association (IowaBio)

Iowa’s investment in biofuels, driven by the federal Renewable Fuel Standard (RFS), has brought the state new business and job opportunities. Iowa is home to three of the first-in-the-nation cellulosic biofuel refineries that are producing the lowest-carbon fuels in the world. Iowa has also broken new ground in the biotechnology, agricultural feedstock and chemical sectors, growing the state’s potential to produce low-carbon biobased products, renewable chemicals, and sustainable feed.

In the face of this success, the U.S. Environmental Protection Agency (EPA) has signaled that it intends to undercut and rewrite the RFS, ensuring that America’s transportation fuel market remains addicted to oil. At a time when the nation is actively looking for low-carbon alternatives to fossil fuels, this move will have shattering consequences for the nation’s environmental health and Iowa’s economy.

Thanks to the RFS, 10 percent of America’s transportation fuel supply now comes from cost-competitive biofuels, and Iowa is a leader in their production. Thanks to biofuels, which are less expensive than gasoline, national fuel prices are lower saving the average American household at least hundreds of dollars per year. Iowa has 43 ethanol plants in operation, producing approximately 3.7 billion gallons per year, which accounts for over 28 percent of U.S. ethanol production. The state also has 13 biodiesel plants, generating about 227 million gallons. The biofuels industry has created or supported more than 850,000 well-paying jobs across the country and more than 73,000 right here in Iowa.

The program has more than met the intended objectives of reducing America’s carbon emissions and its reliance on foreign oil. The Biotechnology Industry Organization (BIO) estimates that over its 10-year lifespan, the RFS has displaced nearly 1.9 billion barrels of foreign oil and reduced U.S. transportation-related carbon emissions by 589.33 million metric tons, equivalent to removing more than 124 million cars from the road over the decade. And yet, EPA is proposing to allow oil refiners to hold the nation’s biofuel use below 10 percent of the transportation fuel mix for the foreseeable future – completely rewriting the program’s intent.

BIO estimates that EPA’s failure to uphold congressionally set statutory volumes for the RFS in 2014 resulted in an increase of 17.4 million metric tons of carbon, which is the equivalent of putting an additional 3.6 million cars back on the road during the year. EPA’s mismanagement of the RFS is clearly allowing backsliding on America’s environmental health.

It’s an odd time for the EPA to be proposing this course, with the final RFS rule for 2014-2016 set to come out on November 30, just as President Obama prepares to attend the United Nations Climate Change Conference in Paris. There, the President will be promoting his Clean Power Plan, which aims to reduce carbon pollution from U.S. power plants by millions of tons over the next 15 years. That plan only covers the electric energy sector, so it might be a bit embarrassing for the President to have to admit to backsliding in carbon emissions from the transportation sector.

But worse could be the impact on Iowa’s jobs, wages, innovation, and economic growth. The RFS has helped Iowa become the leader in the biofuels and bioproducts space and maintain a competitive edge for the biotechnology industry in the international sphere. With the current program in place, Iowa has been able to produce clean homegrown fuel to power U.S. vehicles. Rolling back the Renewable Fuel Standard program signals that the Administration is turning its back on Iowa farmers and rural America.

 

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