Trump open to E15 year-round standard

President Donald Trump offered support of a year-round 15 percent standard at a White House meeting April 12.

Speaking to reporters prior to a meeting with farm-state senators and governors, Trump said the administration was “working on ethanol.”

Not just working on ethanol, but on waiving regulations on what’s called Reid Vapor Pressures to permit summer time use of E15. Usually, in many warm climates, percentages of ethanol are reduced to cut ozone emissions. Trump proposed a two-year transition to the year-round standard.

“I’m working with Chuck Grassley, and with Joni Ernst (both Iowa Republican senators), and with Deb (Fischer, R-NE), and—all of us, right? We’re all working together. And we’re working on the ethanol, and it’s really working out,” Trump said. “I think it’s going to really work out. People have been talking about this for years. And we think we’re going to do something, I will say, early—and now this is no guarantee—but we’re going to raise it up to 15 percent, which makes a lot of people happy.

“We’re going to go to 12 months, which makes a lot of farmers very happy—because we go from eight months to 12 months, that’s a big difference. That was always unnecessary and ridiculous. So we’re going to work out something during the transition period, which is not easy, very complicated, because we have to take care of our refineries. We have to take care of a lot of other people. But we’re working on transition now because there will be a two-year period of time that we have a little bit of complexity while things are happening, while things are being built.

“And we’re going to be helping also—we’re going to be also helping the refineries. So the refineries are going to be able to do much better, because right now there are a lot of them that are not doing well. So we have to help the refineries.”

Reaction

Several farm groups applauded Trump’s move and called on the administration to eliminate similar barriers to expanded use of higher blends of ethanol. National Farmers Union President Roger Johnson said in a statement, “We appreciate the administration’s move to remove this unnecessary regulation that decreases demand for farm products. While this waiver will go a long way towards cutting into the corn supply, more can and should be done for higher blends of ethanol, like E30.

“This high-octane fuel offers better economic, fuel economy and air quality benefits than do lower blends of ethanol, yet far too many barriers continue to exist to keep it from being used. Farmers Union encourages the administration to build on the president’s support for farmers and rural communities by building demand for higher blends of ethanol in our transportation fuels.”

Renewable Fuels Association President and CEO Bob Dinneen said, “We are certainly pleased to hear reports the president has endorsed year-round use of E15, providing consumers access to a higher octane, lower priced fuel option. It will be welcome news to consumers across the country, farmers who have worked to build value-added markets here at home in the face of increased uncertainty in export markets and the investment community that has received conflicting signals regarding future markets for next generation biofuels.”

“If true, the report suggests President Trump intends to fulfill his commitment to a 15 billion gallon RFS. But for that commitment to be fully realized, EPA Administrator (Scott) Pruitt must cease his campaign to destruct biofuel demand with unjustified waivers and other policies meant to undermine the RFS. We look forward to working with the administration to fulfill the promise of a growing and dynamic renewable fuels industry.”

Growth Energy CEO Emily Skor said, “We applaud President Trump for embracing a common-sense fix to create a level playing field for cleaner, more affordable fuel options during the summer driving season. The White House clearly understands that RVP relief will expand a growing market for America’s farmers while letting consumers pick the fuel of their choice. This simple fix allows retailers to offer better options alongside traditional blends all year long.”

National Corn Growers Association President Kevin Skunes said, “Allowing the sale of E15 all year, will allow for less confusion and more savings at the pump for consumers, continue to benefit the environment with the further reduction of emissions and provide corn farmers with a more stable market. NCGA has been advocating for this parity for higher blends of ethanol not only for these benefits but also because additional ethanol blending addresses refiner concerns about RIN values. Increased blending lowers RIN values.

“NCGA realizes there is still work that needs to be done to make this happen, but we will work alongside the President and Administration to make sure this regulatory burden is removed.

“NCGA has been working closely with members of Congress and President Trump’s administration to be sure farmers’ voices are heard. We applaud Secretary (Sonny) Perdue and farmers’ champions in Congress for their steadfast support.

“Even with the positive news from the White House, NCGA continues to call on EPA Administrator Scott Pruitt to stop granting small refinery exemptions, giving extremely profitable refiners a pass on meeting their RFS obligations and destroying demand. We remain opposed to further demand destruction through a RIN price cap or other policies that undermine the RFS.”

Senators issue statement

EPA has confirmed in a letter to five Republican senators that oil refiners aren’t negatively impacted by compliance with the Renewable Fuel Standard, stating that it stood by its previous conclusion that “all obligated parties, including merchant refiners, are generally able to recover the cost of the RINs they need for compliance with the RFS obligations through the cost of the gasoline and diesel fuel they produce.”

Sens. Grassley; John Thune, R-SD; Roy Blunt, R-MO; Fischer and Ernst issued the following joint statement April 12 regarding the response letter from EPA, as well as further reports of EPA receiving applications for and in many cases granting “hardship” waivers meant for “small refiners” to multibillion dollar oil refining corporations.

“EPA’s response to our letter should put to bed any argument that the Renewable Fuel Standard is hurting small refiners. Every time Administrator Pruitt says that the Renewable Fuel Standard needs to be reformed, he’s arguing against his own EPA. All along, this has been nothing more than an attempt to expand market share by killing the Renewable Fuel Standard.

“Since EPA has concluded RIN credit prices aren’t hurting refiners, it makes no sense for the administration to consider a cap or a waiver for the credits, which would devastate the farm economy and destroy the jobs of thousands of biofuels workers. Unfortunately, EPA’s push for a RIN cap or waiver is only one part of a broader attack on the Renewable Fuel Standard.

“It’s not only unfair to refiners who follow the law of the land, but to all the farmers and biofuels workers across the country who are counting on President Trump to keep his word. These waivers aren’t getting too much attention nationally, but the farmers we talk to in our home states are upset with EPA about this issue.

“President Trump’s announcement that he will direct EPA to allow the sale of E15 year-round is welcome news, but EPA’s practice of giving away secret hardship waivers to the country’s biggest oil refining companies needs to stop.”

In a Senate Appropriations agriculture subcommittee hearing on April 11, Perdue told Blunt he agrees with concerns outlined in an April 9 letter from the senators to President Trump that EPA is misusing secret “hardship” waivers to exempt some of the country’s largest oil refining corporations from complying with the Renewable Fuel Standard.

“I concur with your opinion,” Perdue said. “As you know, we have a statutory volume of 15 billion gallons, and those waivers reduce that gallon for gallon….That is demand destruction.”

Larry Dreiling can be reached at 785-628-1117 or [email protected].