In what should have been the ruling in the lawsuit against E15 mandates, the U.S. Court of Appeals for the D.C. Circuit has finally called out the Environmental Protection Agency for using "an unreasonable exercise of agency discretion."
First, it’s unfortunate the case this court decided wasn’t ours, although the National Marine Manufacturers Association still hasn’t given up the E15 fight.
You’ll recall that this same court tossed out our industry’s suit against E15 use for a second time without ever hearing its rock-solid merits. But last Friday, the court might have had an awakening of sorts when it ruled that the EPA is illegally giving the cellulosic ethanol industry extra benefits that Congress never intended.
Here’s the scoop, you’ll love this. The Wall Street Journal reported that an energy bill passed in 2007 required oil companies to blend in fuels that can allegedly be made from switchgrass or farm waste. The problem is that in the six years since passage, not a single gallon has been produced. No one makes it. Oh, but wait, here’s the rest of the story:
Until the court called out the EPA’s action as absurd, the agency was still mandating that oil companies buy cellulosic ethanol (specifically, 6.6 million gallons in 2011 and 8.7 million in 2012) and, when the oil companies couldn’t meet the mandate, they had to purchase millions of dollars of "waiver credits" for failing to buy a product that doesn’t exist. Kinda makes me want to create a new award for EPA — a plaque with a shaft on it.
The court simply found “no basis” for the EPA’s unilateral actions and ordered them vacated. While the impact of this decision seems removed from our industry’s case, it does clearly document the EPA’s bouts with integrity are sporadic, at best, and political shenanigans favoring ethanol producers are part of the agency’s current leadership.
So are we going to allow this to continue? Not while there are options open to us, says NMMA president Thom Dammrich. At this writing, Cindy Squires, NMMA’s point person for the litigation, and NMMA legislative director Jim Currie aren’t sitting still. Squires, along with the other plaintiffs, are exploring options that could even include a run at the Supreme Court.
Currie, on the other hand, will go on offense by joining a diverse group of stakeholders (food and fuel manufacturers, small-engine groups, environmental and anti-hunger organizations, among others) in holding a conference call on Monday. Its purpose will be to outline for the media the negative impacts of the Renewable Fuel Standards. Specifically, Currie will address the dangers to consumers of using fuel above E10 in boat engines and the detriment it will cause to the $72-billion-per-year recreational boating industry. Tests on off-the-production-line outboard engines prove E15 will absolutely destroy marine engines.
We’ve long recognized that revising the fuel standards would be the best, albeit politically the most difficult, solution to the problems created by ethanol. The fuel standard was enacted in 2005 and requires steadily increasing ethanol production. But as a fuel source, corn ethanol is far less efficient than gasoline, providing 27 percent lower fuel economy than traditional gasoline. It consumes more energy to produce than it provides. It costs 70 cents more per gallon to produce even after a 51-cent-per-gallon tax credit enjoyed by ethanol producers.
Moreover, with 40 percent (and increasing) of the U.S. corn crop now being used for ethanol, retail food prices have significantly increased; corn for feeding the world’s hungry is reduced; and EPA’s approval of E15 (blatant pandering to the corn and ethanol producer’s lobby) will result in widespread misfueling, destroy untold numbers of marine and other small engines, and by 2022 is projected by Mark Perry, a University of Michigan economics professor, to consume the nation’s entire corn crop to meet the requirement for 36 billion gallons of ethanol annually.
The ethanol producers’ greatest fear is a revision of the fuel standards. But we have millions of reasons (our customers) to pursue revision and all of us in boating must become engaged.
Here’s a first step:
Plan to attend the American Boating Congress on May 8-9 in Washington, D.C., and help deliver a resounding message to Congress and the Obama administration.
To date, 27 marine trades associations are co-hosting the ABC. A large attendance of dealers from across the country will be a powerful boost to the industry’s efforts. Put it on your calendar now.