Ethanol foes say it’s crunch time

With steep increases in blend on the horizon, industry leaders hope for an ally in Trump’s EPA nominee
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Critics say the ethanol content the Environmental Protection Agency is calling for would push the blend wall to all-time highs — beyond the level deemed safe for marine engines.

Critics say the ethanol content the Environmental Protection Agency is calling for would push the blend wall to all-time highs — beyond the level deemed safe for marine engines.

The boating industry is stepping up its pressure on the incoming Trump administration and the new Congress to stave off drastic ethanol increases in the fuel supply scheduled this year.

The Environmental Protection Agency in late November opted to raise ethanol levels consistent with the amount required by the 2007 Renewable Fuel Standard, though the agency had initially proposed targets beneath that level.

The National Marine Manufacturers Association says it already has collected more than 2,000 signatures on a petition it will present to the administration after the Jan. 20 Inauguration. Signatures are still being sought.

In the Currents newsletter NMMA distributes to its members, the organization says Trump “needs to hear directly from our community to fully understand the dangers and problems that are inherent in the RFS [renewable fuel standard].”

Testing has shown that anything higher than E10, or more than 10 percent ethanol, can damage marine engines.

Though Trump supported the ethanol industry during his campaign, his choice of Oklahoma attorney general Scott Pruitt to head the Environmental Protection Agency has given ethanol opponents new hope. They say the need for remedial action became acute when the EPA reversed course in late November and moved to increase ethanol levels in gasoline beyond what it had initially proposed.

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The EPA said on Nov. 23, the day before the Thanksgiving holiday weekend, that it would raise the biofuel volume mandate for 2017 to levels Congress set in the 2007 RFS, “handing a win to agricultural groups and biofuel makers,” in the view of the NMMA.

The EPA says it will require that 15 billion gallons of conventional biofuel be mixed into the fuel supply — an increase from the 14.8 billion gallons it called for in its initial proposal last May. That proposal, like those in the years preceding this increase, had raised the ire of both ethanol opponents and proponents. Ethanol advocates were angry because the EPA had not raised levels as drastically as dictated by the law.

The new figure, however, is in line with the mark Congress prescribed under the Renewable Fuel Standard during the George W. Bush administration almost a decade ago, and has drawn praise from the corn industry.

“The EPA decided to revert back to the congressional vision of RFS,” says NMMA senior manager of government relations Michael Lewan. “That’s what we’re dealing with in 2017. It’s definitely a bit of a departure.”

The EPA had slowed the increase of ethanol in the overall fuel supply in previous years from the requirements set forth in the 2007 RFS, but it continued to set increases the law requires — albeit at lower levels than outlined in the law. The EPA’s newest proposal increases the need for higher blends of ethanol to record levels in 2017, pushing further past the E10 blend wall, according to critics of the proposal. The blend wall is the term used for the maximum amount of ethanol in fuel that all engines can tolerate — which is E10, or 10 percent ethanol.

The total mandate for biofuels rose to 19.28 billion gallons. The requirement for cellulosic advanced biofuels was set at 311 million gallons, and advanced biofuels were set to 4.28 billion gallons. The 2018 biodiesel mandate has been left unchanged from the proposal, at 2.1 billion gallons.

The November decision by the EPA “directly threatens the safety of millions of American boaters,” says NMMA president Thom Dammrich. “EPA ignored the overwhelming evidence presented by the boating industry in its decision to increase the 2017 ethanol mandate to record highs. EPA’s misguided decision not only denies the public choice at the pump to purchase ethanol-free fuels, but they are now increasing the spread of a dangerous, prohibited fuel blend that will cause damage to marine engines and raises serious safety concerns. It’s clear that the EPA has failed in its duty — now more than ever NMMA urges the new Congress and the Trump administration to work together to deliver actual reforms that fix this broken law and protect the millions of American boaters.”

Although Trump’s position thus far has largely supported ethanol increases, his choice of Pruitt to head the EPA has encouraged ethanol opponents. As Oklahoma attorney general, Pruitt vigorously fought RFS, which Trump supported in his campaign — at one time saying he would tap a farmer to head the EPA.

Lewan remains optimistic that the new administration could usher in the RFS reform the industry has sought. “There’s ample opportunity as we shift to get reforms that break the cycle and update the 2007 law to current market realities,” Lewan says. “Ultimately, the EPA did last November (2015) come below the statutory requirements for 2016. This year, EPA had proposed to come the same proportion below the 2017 requirements, but they have upped that number a bit, which is disappointing, but it underscores why we can’t rely on EPA and government agencies to rule in our favor. We need legislative changes and for Congress to work together to fix the law they wrote. I think there’s a good opportunity entering January to use this announcement as a catalyst to show why we need change sooner rather than later.”

Lewan says the NMMA has been working to bring the Trump transition team up to speed on the issue. “As with any election, the results present new opportunities for us as an industry to educate and engage with the new policy-makers coming to town or shifting roles,” he says.

“Our D.C. team has been reaching out to the Trump transition team to brief them on our issues and the industry, and we look forward to continuing those conversations.”

“The current [Obama] administration seems to be pretty strongly supporting ethanol,” said Mark Riechers, director of regulatory development for Mercury Marine, prior to the election. “There are a lot of people in Congress who’ve indicated they want to push back on this, but not a whole lot has come out of that.”

At the time of the initial proposal, Janet McCabe, acting assistant administrator of the EPA’s Office of Air and Radiation, said the RFS was “a success story that has driven biofuel production and use in the U.S. to levels higher than any other nation.”

Last year she told The Hill website that the agency was “balancing two dynamics: Congress’ clear intent to increase renewable fuel over time to address climate change and increase energy security and the real-world circumstances that have slowed progress toward these goals.”

“The way we look at it is, the EPA has the latitude to make yearly changes one way or the other. That’s why we advocate to them to keep the numbers lower — preferably below this year’s numbers, and definitely below next year’s,” says Lewan. “But beyond that, we do need Congress to reform the law they wrote almost 10 years ago. The EPA, in many ways, is administrating a law that was not written by them. They’re just tasked with enforcement and compliance.”

This article originally appeared in the February 2017 issue.

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