While some viewed Tuesdays proposal from the Environmental Protection Agency as a win for farmers, representatives of both the Kansas Corn Growers Association and the National Corn Growers Association were not convinced.
Two weeks ago the Trump administration ordered the EPA to restore lost ethanol production, but didnt offer a plan.
This week the EPA released its proposed rules to change how renewable fuel percentages are calculated.
While it should boost production in the future, corn growers fear it will not make up for past losses, which have averaged 1.34 billion gallons of ethanol less per year than what refineries are required to mix into the nations fuel supply.
According to Josh Roe, who serves as vice president of market development and policy for the KCGA, the government is falling short on its promise.
Its the old bait-and-switch trick, Roe said. On Oct. 4, the EPA came out and said they were going to make sure it goes back up to 15 billion gallons of ethanol in 2020, which sounds great. But when you really look at the wording, it falls way short. Over the last three years the average has been 1.34 billion gallons of ethanol not put into the fuel supply. But they are going to go by the numbers produced by the DOE, which cuts it down to 770 million gallons. Thats a big change. Thats barely half of what we lost. We get the report and its like are you kidding me? Thats a lot of bushels of corn and a lot of potential ethanol that will not be used.
Roe said what adds to the frustration are the refineries who are getting the exemptions, should be wanting to put ethanol in their product.
That is a sore topic, because they act like they are just these poor struggling refineries, but the truth is, corn is cheap, ethanol is cheap. It is a whole lot cheaper to blend your fuel with ethanol than some of the additives they are using.
KCGA CEO Greg Krissek expressed his disappointment in a press release.
Farmers look to ethanol demand as a high priority for creating a stable corn market. The proposed rule does not meet our expectations for accounting for the lost ethanol demand caused by the refinery waivers granted by the EPA in recent years. The next several years are critically important to the economic survival of many corn producers, Krissek said.
The guidelines seek to establish the cellulosic biofuel, advanced biofuel, and total renewable fuel volumes for 2020 and the biomass-based diesel volume for 2021 under the Renewable Fuel Standard program.
The EPA wants projections for the volume of gasoline and diesel that will be exempt in 2020, due to small refinery exemptions. They will make these projections based off a three-year average of fuel production from refineries who received waivers, and others that were granted partial exemptions by the Department of Energy.
Last week, Bill Pracht, CEO of East Kansas Agri-Energy, based out of Garnett, said the waivers had resulted in 4 billion gallons of lost production over a three to four-year period.
The proposed rule does nothing to make up for lost production, which resulted in the closure of several ethanol plants around the country, while others have halted production.
We will hold the administration to their stated commitment that 15 billion gallons in the RFS means 15 billion gallons. The RFS provides market access for ethanol, and we rely on the certainty that the RFS law provides, Krissek said.
