Another Battle Looms in the Endless Ethanol War

The debate over the renewable-fuel standard flared up again this week ahead of a hearing the Environmental Protection Agency will hold on Thursday to solicit feedback on a proposal to lower the 2014 production mandate.

Interest groups from both sides of the debate have found common ground on one point — they want the proposal changed. But that's where the consensus ends.

Biofuels backers say the EPA's proposed cutbacks go too far. Advanced Biofuels Association President Michael McAdams called the 2014 levels announced last month a "woefully inadequate target," and referred to the draft as the "industry's worst nightmare" during a call with reporters on Wednesday.

The oil and gas industry and other interest groups, including restaurant and poultry associations, say that while EPA's decision to potentially lower next year's renewable-fuel volume obligations is a step in the right direction, the mandate needs to be disassembled. And they're looking for a legislative fix.

"We've always maintained that the actions of the EPA will be short-term in nature, and we really are looking to members of Congress to address this severely flawed and outdated renewable-fuel standard," Charles Drevna, president of the American Fuel and Petrochemical Manufacturers Association, said Wednesday during a press call.

Ethanol backers disagree, saying that authority to amend the mandate should remain with EPA despite their criticism of the agency's most recent proposal.

"[This] is entirely an administrative challenge," Brooke Coleman, executive director of the Advanced Ethanol Council, told National Journal Daily. "While members of Congress can and should weigh in on the matter, there is no need for any sort of legislation. We have issues with the proposal and will seek to get it fixed administratively. But as we have said all along, EPA has the authority it needs to administer the law properly without further action by Congress."

Congress has so far been slow to take up the issue anyway, and there's speculation that EPA's move to lower the targets might make lawmakers less likely to act.

"I do think that EPA action took the pressure off, at least momentarily," said Rep. Peter Welch, D-Vt. "But the pressure for Congress to act isn't going away. If anything, EPA's decision shows that there's a growing consensus that the mandate is not working."

What is clear, however, is that action won't come this year — at least not in the House. A spokesperson for the House Energy and Commerce Committee confirmed that there are no hearings planned on the issue for the remainder of the year.

"I doubt there will be much of an appetite for moving legislation until the rulemaking for 2014 shakes out," said Rep. Jim Costa, D-Calif. "My hope is that my colleagues will come back next year ready to discuss and approve real, wholesale changes to the RFS."

Costa and Welch, along with Reps. Bob Goodlatte, R-Va., and Steve Womack, R-Ark., have introduced legislation to limit the total amount of ethanol refiners would need to blend with gasoline under the mandate. The bill remains pending in committee.

In November, aides for Sens. Dianne Feinstein, D-Calif., and Tom Coburn, R-Okla., told National Journal that the senators were working together to draft legislation to eliminate the corn-ethanol mandate from the standard. But the legislation has not yet surfaced, and neither office responded to a request for comment on the status of the measure on Wednesday.