House bills aim to alter, eliminate the RFS

By Erin Voegele | February 04, 2015

On Feb. 4, Rep. Bob Goodlatte, R-Va., announced the introduction of two bills that aim to alter the renewable fuel standard (RFS), including the RFS Elimination Act and the RFS Reform Act. Reps. Peter Welch, D-Vt.; Steve Womack, R-Ark.; and Jim Costa, D-Calif. have also sponsored the RFS Reform Act, with a total of 34 members of Congress signing on as cosponsors. According to Goodlatte, 38 members of Congress have cosponsored the RFS Elimination Act. Both bills will be referred to the House Energy and Commerce Committee.

A copy of the RFS Reform Act, H.R. 704, published by Goodlatte’s office indicates the bill would prohibit gasoline blends with more than 10 percent ethanol. It would also eliminate the use of corn-based ethanol for RFS compliance and require the U.S. EPA to set the cellulosic volume requirement at actual production levels.

The RFS Elimination Act, H.R.703, would repeal the entire RFS program.

The Renewable Fuels Association pointed out this is not Goodlatte’s first attempt to dismantle the RFS. He has introduced similar legislation the past two years. “Today’s legislation may be familiar, but it is still a reckless paean to Big Oil,” said Bob Dinneen, president and CEO of the RFA. “It is a callous effort that reneges on a government commitment upon which billions of dollars have been invested. As a direct result of the RFS, more than $30 billion has been invested in infrastructure and expanded production capacity, creating an industry that is responsible for nearly 400,000 jobs and contributes $44 billion to the GDP. Rep. Goodlatte would put all of that at risk to protect Big Oil’s monopoly, sending a dangerous chill through the investment community that will forever more question the government’s resolve.”

“Moreover, the legislation is predicated on a false premise that the RFS is contributing to increased food and fuel costs when the exact opposite is true,” Dinneen continued. “Goodlatte clearly overlooks the fact that ethanol reduces the cost of gasoline at the pump while also contributing more than 39 million metric tons of high-protein animal feed fed to livestock and poultry here and abroad. Indeed, Rep. Goodlatte is introducing his bill on the heels of the largest corn crop in history, lowering the price of a bushel to less than what it was when the RFS was passed and less than the cost of production. This bill is a slap in the face to corn farmers across the country who responded to the RFS with increased production and yields. The result of this bill will be increased farm program costs and pain across rural America.”

“The announcement today is a step backward in energy policy, cutting the legs out from under a burgeoning cellulosic biofuels industry, denying consumers choice at the pump, and returning us to a petroleum only energy economy that brings nothing but price volatility and environmental disaster,” said Dinneen.

Growth Energy has also spoken out to criticize the legislation. “This bill does nothing to address the critical policy goal of achieving U.S. energy independence, nor will it lower the price of food as the bill authors claim,” said Tom Buis, CEO of Growth Energy. “Instead, it is a gift to special interest groups who are only concerned with maintaining their record profits. The RFS Reform Act is nothing more than a way for Big Oil to prevent market access to a higher octane, price competitive product, such as E15. While E15 is a voluntary choice for consumers and retailers, oil companies know that E15 will provide consumer savings and superior engine performance that cuts into their bottom line and they will do everything in their power to stop it. This legislation is a wish list for opponents of the RFS who want to kill the RFS and all the successes Americans have realized as a result of the policy.”

"This proposal is also a gift to Big Food in their effort to extend their record profitability by blaming ethanol for food price increases,” Buis said. “For the past two years, American farmers have produced record corn crops while receiving market prices that are now below their cost of production. This has provided an economic boon to the integrated U.S. livestock and chain restaurant industries that tout their profitability to their stakeholders while consumer food prices, led by the meat sector, continue to escalate. The RFS is the most successful energy policy this nation has enacted in the last forty years. It creates jobs and investment at home that cannot be outsourced, revitalizes rural economies, improves the environment and reduces our dependence on foreign oil.”

“Any changes to the program would have a devastating effect, creating uncertainty in the marketplace and halting investment in new technologies for biofuel production,” Buis continued. “This so-called ‘reform’ bill is drafted to enrich a few special interests by ensuring that the fossil fuel industry retains its control over the transportation fuel marketplace by limiting market access and competition from products they don’t control while short-changing the American consumer.”