Obama administration looking at ethanol rules

Ethanol Mandate

A 2007 energy law known as the Renewable Fuels Standard mandates the use of 13.2 billion gallons of biofuels such as ethanol this year, and 13.6 billion in 2013.

A smaller U.S. corn crop doesn’t justify calls for Obama to suspend the mandate, according to the Renewable Fuels Association, a Washington trade group. It said refiners can meet the targets by drawing from ample stockpiles and utilizing excess credits that can be submitted in lieu of physically blending a gallon of ethanol.

Ethanol production also results in distillers grains, a byproduct of manufacturing the fuel, that can be fed to livestock and poultry, Growth Energy Chief Executive Officer Tom Buis said in a statement today in response to a UN call to alter the policy.

“We are in close contact with USDA as they and we keep an eye on crop yield estimates, and we will review any data or information submitted by stakeholders, industry and states relating to the RFS program,” Alisha Johnson, an EPA spokeswoman, said in a statement Aug. 2. She said today that the statement stands.

‘Severe’ Harm

Livestock and poultry producers on July 30 called on Obama to reduce the mandate saying that it is causing “severe economic harm.”

Delaware Governor Jack Markell and Maryland Governor Martin O’Malley, both Democrats, sent a letter to the EPA’s Jackson today supporting the waiver, saying that the Renewable Fuels Standard may hurt their farmers and poultry companies.

Ethanol production was 817,000 barrels a day last week, down 15 percent from a record in December. Stockpiles sank 3.9 percent to 18.7 million barrels, the lowest level since Dec. 30, Energy Department data show.

Bloomberg News

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