EPA Trims Renewable Fuel Standard for 2014
November 22, 2013
The Environmental Protection Agency (EPA) on Nov. 18 proposed 2014 renewable fuel standards that, for the first time, would reduce the volume of ethanol refiners must add to the fuel supply relative to targets established under the Renewable Fuel Standard (RFS) in 2007. The EPA proposed that 15 billion to 15.52 billion gallons of ethanol be added to the fuel supply in 2014 compared with 18.15 billion gallons as targeted by current law.
The EPA in its announcement pointed to what it called an "E10-blend wall" as a reason for the lower target.
"Nearly all gasoline sold in the United States is now E10, which is fuel up to 10 percent ethanol," the EPA said. "Production of renewable fuels has been growing rapidly in recent years. At the same time, advances in vehicle fuel economy and other economic factors have pushed gasoline consumption far lower than what was expected when Congress passed the RFS in 2007. As a result, we are now at the 'E10-blend wall' -- the point at which the E10 fuel pool is saturated with ethanol. If gasoline demand continues to decline, as currently forecast, continuing growth in the use of ethanol will require greater use of higher ethanol blends such as E15 and E85."
Groups representing the food and agriculture industries have criticized the proposal, saying it's not enough to address artificially high food prices caused by using corn as fuel.
Earlier this year, the American Sheep Industry Association joined a coalition of livestock and poultry organizations urging legislation that would reform the RFS and its inflexible mandate. The mandate on corn-based ethanol, in particular, had a devastating effect on the entire food economy from the livestock and poultry producers facing record feed costs to consumers' balancing food budgets in tough economic times.