Chuck Grassley

United States Senator from Iowa

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Grassley, Ernst WSJ Op-ed: Trump Gives Farmers a Jolt of Fuel

Oct 17, 2018

Trump Gives Farmers a Jolt of Fuel

Wall Street Journal

By Sens. Chuck Grassley and Joni Ernst of Iowa

President Trump’s decision last week to allow the year-round sale of E15 is a promise made and kept to farmers throughout rural America. E15 is shorthand for gasoline blended with 15% ethanol, instead of the more common E10, and was prohibited for sale in the summer by the Environmental Protection Agency in 2011.

Biofuels are a part of everyday life in Iowa, the top corn- and ethanol-producing state in the U.S. Ethanol supports more than 43,000 Iowa-based jobs and 350,000 jobs throughout the country, directly and indirectly. Ethanol contributed $44.4 billion to gross domestic product and $5 billion in federal tax revenue in 2017.

Year-round E15 sales will bring increased stability to the market and create new growth opportunities. Today only about 1,400 out of 122,000 filling stations in the U.S. sell E15. That’s a result of the Obama-era regulation, not a lack of consumer demand. With filling stations prohibited from selling higher-ethanol blends for nearly a third of the year, it often didn’t make economic sense to install the infrastructure necessary to sell the product at all. That will change after the implementation of year-round E15.

The change couldn’t come at a better time. Farm income is down 47% over the past five years. The U.S.-Mexico-Canada agreement will help, but there’s still unrest in America’s heartland about trade negotiations between the U.S. and China. The administration’s E15 action will deliver a timely infusion of optimism to farmers. It will also put an end to an unnecessary government regulation that hinders consumer choice at the pump.

The end of this anticompetitive regulation is long overdue. For years it has effectively prevented gas-station owners from investing in dedicated E15 pumps. It has eliminated competition for the oil companies, deprived consumers of the ability to make their own fuel choices and reduced market opportunities for farmers.

Ethanol was adopted decades ago as a natural alternative to octane boosters like lead and MTBE, which posed serious environmental and health hazards. It also lowers the price at the pump. While petroleum prices may rise or fall depending on the actions of exporter countries, the U.S. can produce ethanol domestically and uninterrupted.

Year-round E15 could be implemented as soon as next summer. But Big Oil will fight to preserve the regulation, to the detriment of farmers, agribusiness workers in rural America, and the millions of Americans who want cleaner, cheaper fuel options. The almost-certain legal battles the oil companies will wage will prolong uncertainty for farmers, stall economic growth, and divert federal tax dollars from other pressing needs. And for what? To restrict competition and further increase the already significant margins of the nation’s oil companies.

We’ve spoken regularly with President Trump about the importance of ethanol and the Renewable Fuel Standard to Iowa and rural America—and to the nation’s economy and national security. We look forward to seeing this important deregulation through the bureaucratic process.

Mr. Grassley and Ms. Ernst are Republican U.S. senators from Iowa.

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