Q&A: E15 Year-Round
With U.S. Senator Chuck Grassley
Q: What is the Renewable Fuel Standard?
A: In 2005, Congress amended the Clean Air Act with passage of the Energy Policy Act to create the renewable fuel standard (RFS). This came after revelations that a common fuel additive to help gasoline burn more completely, MTBE, was contaminating water and linked to cancer. Ethanol offered a safer alternative so the RFS was supported by many in the oil industry at the time. This historic bipartisan public policy helps to diversify the nation’s fuel supply, reduce emissions, increase energy security, lessen U.S. dependence on imported oil, create jobs and foster economic vitality in Rural America. As an advocate for homegrown renewable energy and American agriculture, I also worked to expand the RFS with passage of the Energy Independence and Security Act of 2007. For the last decade, I have deployed robust congressional oversight as a champion for renewable fuels to ensure the RFS is working as Congress intended. The executive branch administers the RFS through the Environmental Protection Agency (EPA) in coordination with the USDA and Department of Energy. The RFS requires the EPA to set an annual volume target for renewable fuel to replace or reduce petroleum-based transportation fuel. This policy provides an important benefit for consumers by expanding clean-burning fuel choices at the pump. The RFS applies to four categories of fuel: biomass-based diesel; cellulosic biofuel; advanced biofuel and total renewable fuel. Fuel refiners and importers of gasoline and diesel fuel are obligated to achieve RFS compliance by blending renewable fuels into transportation fuel. Alternatively, they may purchase credits, called Renewable Identification Numbers (RINS) to comply with the renewable volume requirements and blending quotas. For the past year, I have worked to secure transparency and accountability in the RINS program to weed out wrongdoing and stop the misuse of economic hardship waivers available for small refineries. I continue to work closely with a bipartisan coalition of lawmakers to ensure the EPA doesn’t underestimate the potential for U.S. domestic renewable energy and as a result undercut growth in the industry. When it comes to clean air, U.S. energy security and the farm economy, it’s very important for the EPA to set RFS targets that drive investment and growth in renewable fuel development, as Congress intended, to put the United States in a better position for cleaner air, sustainable domestic energy and stronger national security for future generations.
Q: Why is the Trump administration’s E15 announcement good for the Iowa economy?
A: Iowa is the number one corn producing state in the nation. We are also the number one ethanol producing state in the country with 43 refineries employing thousands of workers, boosting economic activity on Main Street and expanding the local tax base. The USDA expects a bumper crop in 2018 amid a five-year slump in commodity markets. Corn-based ethanol adds value to the billions of bushels of grain farmers are harvesting this fall. Meanwhile, the Farm Belt is facing income uncertainty as American agriculture finds itself in the cross-hairs of retaliatory trade tariffs. It has created anxiety among Iowans whose livelihoods and prosperity are tied to Iowa’s export-dependent economy. Don’t forget, one-third of farm income is attributed to foreign sales. It’s very good news for Iowa farmers and the state’s economy that President Trump in October announced he will direct the EPA to allow year-round sales of E15, gasoline containing 15 percent ethanol. The announcement also will pave the way for filling stations to make the investments needed to sell E15 to consumers. Currently, roughly 1,400 out of 122,000 U.S. filling stations sell E15. Making E15 available for sale year-round will accelerate growth in the industry. But make no mistake. As the rule-making process winds its way through the federal bureaucracy, Big Oil will accelerate its efforts to throw sand in the gears of year-round E15 to block competition and consumer choice at the pump. I’ll be working closely with the Trump administration and farm-state lawmakers to help the president keep his promise to expand year-round sales of E15.