Blog Archive
Subscribe in a reader

Read the RFS before calling for its demise

Posted: May 12, 2008 at 04:11 PM CST

Ethanol is under attack. There's no denying that. Some people, half tongue-in-cheek, say the oil industry is behind it all, but it's hard to draw any serious connections.

Personally, I think it's the media - the popular press - that is unwittingly propagating this harsh misinformation campaign against ethanol. But it's not intentional. The U.S. ethanol industry is getting it's butt kicked in the press not by lies, but by lazy reporting. That's right, we're getting hammered by journalistic indolence. In the spree of copycat editorials we've witnessed in the past few weeks, some of America's most revered newspapers, including The New York Times, have shown us what the media can be at its worst: hurried, wrong … influenced rather than influential.

A group of 24 U.S. senators sent a letter to the EPA a week ago asking the agency's chief, Stephen Johnson, to consider waiving the requirements of the renewable fuels standard. In the name of lowering food prices, the lawmakers want the EPA to reduce or suspend the requirements of the RFS, which requires U.S. blenders, refiners and importers to use 36 billion gallons of biofuels by 2022 - 9 billion gallons by the end of this year. The bill permits up to 15 billion gallons of that volume to come from corn ethanol. For the most part, the rest will come from non-corn-based advanced biofuels.

A second group of Corn Belt Senators staged a counterattack a few days later with a letter of their own that urged the EPA not to roll back the RFS. The nationwide pontificating began shortly thereafter. America's newspapers - a whole lot of them - weighed in over the weekend, which brings me to the problem I have with the Times. In a Sunday (May 11) editorial titled, "Rethinking Ethanol," the Times editorial board said, "The time has come for Congress to rethink ethanol … It is time to end an outdated tax break for corn ethanol and to call a timeout in the fivefold increase in ethanol production mandated in the 2007 energy bill."

That part didn't surprise me, but what the Times said next did. It said, America should not give up on biofuels, but it should abandon corn ethanol and "realign its tax and subsidy programs to encourage the good ones. Unlike corn ethanol, those biofuels will not compete for the world's food supply and will deliver significant reductions in greenhouse gases. … Congress's guiding principle should be to tie federal help to environmental performance. The goal is not just to stop the headlong rush to corn ethanol but to use the system to bring to commercial scale promising second-generation biofuels-cellulosic ethanol derived from crop wastes, wood wastes, perennial grasses. These could provide environmental benefits and reduce dependence on oil without displacing food production."

Sadly, it is clear that the editorial board of one of our nation's most read and respected newspapers is too busy or too partial to really care about the RFS or the ethanol industry. If they would have bothered to take a quick look at the policy, they would have realized that the RFS does exactly what they are asking Congress to do; it places a 15-billion-gallon pseudo-ceiling on corn ethanol and puts strong market incentives in place for 21 billion gallons of second generation biofuels … biofuels made from the very raw materials they're pushing for. I honestly don't think they get it. They certainly didn't get it Sunday.

And if they would have visited Ethanol Producer Magazine's Web site and conducted some simple research, they would have realized that the U.S. ethanol already has the ability to produce 9.42 billion gallons of ethanol - more than the 9 billion gallons the RFS requires this year - and the 42 facilities under construction represent another 3.76 billion gallons of production. That means almost 13.2 billion gallons of corn ethanol is either on line or under construction in the United States, which means that pseudo ceiling on corn ethanol is very near. A little further investigation would have told them that no new ethanol projects have broken ground since the start of the year, indicating that the corn ethanol industry's build out has hit a plateau (temporary or not) and the flow of investment dollars is starting to shift toward the advanced biofuels prescribed by the RFS … that is, if Congress and the EPA don't listen to The New York Times and stop this industry's historic growth dead in its tracks.

-Tom Bryan