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Senators press EPA to cut US ethanol mandate

Source: Thomson Reuters Foundation - Tue, 7 Aug 2012 22:05 GMT
Author: Reuters
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WASHINGTON, Aug 7 (Reuters) - As the worst drought in more than 50 years withers the Midwest corn crop, 25 U.S. senators urged the Environmental Protection Agency to cut the mandate that requires fuel blenders to add grain-based ethanol to gasoline.

The senators representing 25 percent of the chamber urged EPA chief Lisa Jackson to adjust the Renewable Fuels Standard, or RFS, that requires fuel blenders to mix 13.2 billion gallons of ethanol into gasoline this year.

The mandate rises steadily until peaking at 15 billion gallons per year in 2015 and holding that level through 2022.

The lawmakers blame the mandate for raising the price of corn -- the main feedstock for U.S. ethanol refining -- which threatens to increase feed costs for livestock producers and eventually saddle consumers with higher food costs.

Some 40 percent of the U.S. corn crop is now used to make ethanol, though some byproducts of the process are fed to livestock.

"Adjusting the corn grain-ethanol mandate of the RFS can offer some relief from tight corn supplies and high prices," said the senators including Ben Cardin, a Maryland Democrat, and Tom Coburn, an Oklahoma Republican.

None of the senators are from a major corn growing state where the RFS remains popular with farmers and ethanol distillers for the jobs it supports.

As the drought threatens crops, the call to reform the RFS is growing louder. Last week, nearly one-third of the lawmakers in the 435 member U.S. House of Representatives signed a letter urging the government to ease the mandate.

Neither set of lawmakers specified how much they wanted the mandate to be adjusted.

The EPA, which has the power to adjust the RFS on its own, did not immediately comment on the letter.

In 2008, Texas Governor Rick Perry petitioned the EPA to cut the mandate in half for that year. The EPA refused, but in doing so it made clear that future petitions would have to prove that the RFS itself was causing severe economic harm and not just contributing to any such condition.

Legislation to adjust or eliminate the mandate is stalled in election year gridlock in Congress.

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