Critics unload on Trump administration biofuel proposal


(Reuters) – Representatives of both the oil and corn industries unleashed criticism of the Trump administration’s proposed biofuels plan for next year during a public hearing on Wednesday hosted by the U.S. Environmental Protection Agency (EPA).

Grain bins are seen in front of crops at Knuth Farms in Mead, Nebraska, U.S., August 28, 2019. REUTERS/Stephanie Keith

The hearing in Ann Arbor, Michigan, marks the second public meeting on the topic in as many days, airing the grievances of two key political constituencies President Donald Trump has been working to win over ahead of next year’s election.

At issue is a proposal unveiled this month by Trump’s EPA that would increase the amount of corn-based ethanol some oil refineries must blend next year to make up for volumes the agency expects to waive under its Small Refinery Exemption program.

The proposal was meant to please farmers, while securing a program the oil industry says is crucial to the survival of small oil refining facilities. It has instead drawn criticism from both sides.

The corn industry says the plan does not go far enough to help ailing biofuel producers, and the oil industry complains the proposal is unfair to refineries that must do more blending.

A spokesman for the Advanced Biofuels Association said the proposal would account for just a fraction of the volumes of biofuels the EPA has waived for small refineries over the past few years.

Patrick Kelly, a spokesman for the American Petroleum Institute, said the proposal “punishes the companies already complying” with the nation’s biofuel law.

The U.S. Renewable Fuel Standard (RFS) requires the refining industry to add some 15 billion gallons of ethanol every year to its gasoline. But small individual facilities of 75,000 barrels per day or less can secure exemptions from the RFS in a confidential process, provided they prove compliance would cause them disproportionate economic harm.

The EPA has roughly quadrupled the number of waivers granted to small refiners since Trump took office in January 2017, angering the corn industry which says the exemptions hurt farmers by cutting ethanol blending volumes.

The oil industry says the waivers are crucial to the survival of small refineries and deny that the exemptions have a meaningful impact on ethanol demand.

On Tuesday, the House of Representatives Energy and Commerce Committee held a hearing to discuss the waiver program, at which biofuel industry representatives argued the EPA should limit their use and provide more information about applicants and recipients.

Reporting by Richard Valdmanis in Boston; Editing by Peter Cooney and David Gregorio

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