Environmental Protection Agency denies ethanol waiver requests

The Environmental Protection Agency has denied requests from some U.S. state governors and associations for a waiver of the current production requirements for corn-based ethanol, according to reports.
Sources that requested the waiver said the 2012 U.S. drought made the Renewable Fuel Standard untenable. "The worst drought in half a century has made a bad situation worse," said National Chicken Council President Mike Brown in October. "Record high and extremely volatile grain prices have been the norm since the introduction of the Renewable Fuel Standard and have greatly impacted our cost of production, severely harming our economic well-being."
The National Corn Growers Association has said that it supports the Environmental Protection Agency’s decision to deny the Renewable Fuel Standard waiver request. "We believe Administrator [Lisa P.] Jackson appropriately recognized petitioners did not properly prove severe nationwide economic harm had occurred thereby creating no justification for a waiver of the RFS," said association President Pam Johnson. “The ethanol industry plays a pivotal role in job creation throughout the country, supporting over 400,000 jobs nationwide. This includes many in ethanol plants in rural America. The RFS advances the use of domestically produced renewable fuels, encourages new technologies and enhances U.S. energy independence.”
A coalition of livestock, poultry and dairy organizations, however, expressed disappointment with the decision. “We are extremely frustrated and discouraged that the EPA chose to ignore the clear economic argument from tens of thousands of family farmers and livestock and poultry producers that the food-to-fuel policy is causing and will cause severe harm to regions in which those farmers and producers operate,” said the coalition. “How many more jobs and family farms have to be lost before we change this misguided policy and create a level playing field on the free market for the end users of corn? It is now abundantly clear that this law is broken, and we will explore remedies to fix it.”
The American Feed Industry Association has also called for further action in the wake of the Environmental Protection Agency's denial of the waiver. “AFIA will call on Congress and the Administration to not let this issue be ignored," said President and CEO Joel G. Newman. "Congress must pass and implement an RFS temporary trigger mechanism based on the USDA-calculated corn stocks-to-use ratio. This solution is recommended in H.R. 3097, the Renewable Fuel Standard Flexibility Act, introduced by Reps. Bob Goodlatte (R, Va.) and Jim Costa (D, Calif.) with bipartisan support from more than 30 members of the House."

US senators, representatives ask EPA to adjust corn ethanol mandate

U.S. senators and House representatives have called on the Environmental Protection Agency to adjust the corn-ethanol mandate for the Renewable Fuel Standard due to the continuing severe drought, according to reports.
Their request joins an existing coalition of livestock, poultry, meat, dairy and feed organizations that has already delivered a petition to the EPA asking for a waiver “in whole or in substantial part” of the amount of renewable fuel that must be produced under the Renewable Fuel Standard for the remainder of 2012 and for the portion of 2013 that is one year from the time the waiver becomes effective. “As stressful weather conditions continue to push corn yields lower and prices upward, the economic ramifications for consumers, livestock and poultry producers, food manufacturers and foodservice providers will become more severe,” said the senators. “We ask you to adjust the corn grain-ethanol mandate of the RFS to reflect this natural disaster and these new market conditions. Doing so will help to ease supply concerns and provide relief from high corn prices.”
The representatives say that another short corn crop would be devastating to the animal agriculture industry, food manufacturers, foodservice providers and consumers. Both the senate and the representatives have gained the support of the coalition. “We appreciate that these representatives have fully grasped the scope of this crisis,” said National Turkey Federation President Joel Brandenberger. “Anything other than immediate action would be a blatant disregard for the petition process of the RFS. The emergency is happening now, today."

Proposed legislation would reduce ethanol tax credit for two years

Proposed legislation that would reduce the Volumetric Ethanol Excise Tax Credit for a two-year period before transitioning to a tax credit that would adjust based on the price of oil has gained support from the National Corn Growers Association, the American Coalition for Ethanol, Growth Energy and the Renewable Fuels Association.
The Domestic Energy Promotion Act of 2011, spearheaded by Iowa Senator Chuck Grassley, would also improve upon current tax credits for the installation of blender pumps and ethanol fueling infrastructure, and would extend tax credits for small ethanol producers as well as for advanced and cellulosic ethanol. "The Domestic Energy Promotion Act of 2011 would ensure we don’t abandon this increasingly vital American industry, but rather smartly and responsibly foster its continued growth and evolution,” said the groups. “This legislation rightfully recognizes budget constraints by reforming the ethanol tax credit and significantly reducing its cost. Critically, this legislation would also ensure progress made to commercialize advanced ethanol technologies utilizing new feedstocks such as grasses and municipal solid waste is accelerated"

Agriculture organizations support bill to end California ethanol subsidies

A California Assembly bill, AB 523, has been introduced that would end state ethanol subsidies; organizations such as the California Poultry Federation and Western United Dairymen have given their support.

Twenty-two agricultural and business organizations have said they support the end of California subsidies for the production of corn-based ethanol.
A California Assembly bill, AB 523, has been introduced that would end the subsidies; organizations such as the California Poultry Federation and Western United Dairymen have given their support.
In a statement to the assembly, the agricultural groups asked legislators to consider the following:

• Increased demand and competition for corn resulting from growth in corn-based ethanol production has driven up the price of corn to over $7 per bushel, more than doubling in price from just last year;
• Higher corn prices directly impact California families through higher food prices. Corn is a basic ingredient in thousands of food items and rising prices affects families of all income levels, particularly low income households;
• Rapidly rising corn prices are having a highly detrimental effect on undeveloped and developing countries and exacerbating world hunger; and
• California poultry, dairy and cattle producers, heavily impacted by the cost of feed, are being decimated by the run-up in corn prices. These businesses have seen multi-million dollar increases in weekly feed costs over the previous year and costs are continuing to rise. Collectively, these industries provide more than 500,000 California jobs and face financial ruin.