The EPA Rejects Governors’ Plea Over Ethanol
The governors of seven drought afflicted states petitioned the Environmental Protection Agency, asking for a suspension of rules requiring refiners to blend biofuel — mostly ethanol — into the nation’s gasoline supply.
The governors of Georgia, Texas, Arkansas, North Carolina, Maryland, New Mexico, and Delaware contended that the renewable fuel standard (RFS) program requiring the use of biofuel, combined with the worst drought in 40 years, had pushed corn prices to record highs and harmed the states’ meat and dairy producers, who use corn as an animal feed.
On Friday, Nov. 16, the Obama administration’s EPA turned down the petition.
This year about 4.7 billion bushels, or 40 percent of the nation’s corn crop, will be used for ethanol production, and ethanol production is set to increase next year.
The Clean Air Act authorizes EPA Administrator Lisa Jackson to waive the RFS targets for ethanol production for one year if the requirements would “severely harm” the economy of a state or the nation as a whole, which the governors claimed they do.
Arkansas Gov. Mike Beebe’s petition to the EPA stated that “virtually all of Arkansas is suffering from severe, extreme, or exceptional drought conditions,” and rising corn prices are “having a severe economic impact” on the state’s livestock producers.
“While the drought may have triggered the price spike in corn,” the fuel standards exacerbated the problem — the policy boosted corn prices 193 percent since 2005.
He also asserted that livestock producers hit hard by rising corn prices “represent nearly half” of the state’s farm sales.
“However, the EPA stacked the decks against petitioners, establishing a burden of proof that was virtually impossible to meet,” according to Mario Lewis, a senior fellow in energy and environmental policy at the Competitive Enterprise Institute.
In an article on National Review Online, Lewis explained that the EPA in essence required the petitioners to show that the biofuel requirement was entirely responsible for the harm and not merely a contributing factor, and that waiving the requirement would “remedy” the hardship facing livestock producers.
“These criteria are ridiculous,” Lewis declared.
“The Clean Air Act does not require the EPA to don analytical blinkers and ignore other factors that, in combination with the RFS, cause severe harm, nor does it say that any waiver granted must be a silver bullet.”
But he adds: “This cloud may yet have a silver lining. Jackson’s rejection of the waiver petitions exposes the RFS program as an arbitrary, inflexible system that provides corporate welfare to corn farmers at the expense of livestock producers, consumers, and hungry people in developing countries.”
Administrator Jackson was designated for the post by President-elect Obama in December 2008, and she was confirmed by the Senate in January 2009.
Lewis observes: “The EPA’s decision may very well build support for RFS reform — or repeal.”
Attribution: Drudge Report