Livestock, Ethanol Groups Hanging Tight to Differing Opinions on RFS

House Energy and Commerce Committee hearing affirms each sector's viewpoints on RFS in white paper comment request

Published on: May 2, 2013

Both livestock and ethanol groups this week submitted comments to the House Energy and Commerce Committee again affirming differing viewpoints on the federal Renewable Fuels Standard.

The Committee released a white paper last month requesting comments specifically from agricultural interests on the impact of the RFS. The request is the second in a series of five white papers that have and will focus on RFS impacts across a wide range of sectors.

In comments presented to the Committee, livestock groups maintained that the RFS – which this year mandates that 16 billion gallons of renewable fuels enter the market – causes corn prices to rise and stocks to fall.

House Energy and Commerce Committee hearing affirms each sectors viewpoints on RFS in white paper comment request
House Energy and Commerce Committee hearing affirms each sector's viewpoints on RFS in white paper comment request

"The RFS has been the major driver in increasing corn use for ethanol production, and causing corn stocks to decline to crisis levels," the comments state. "In a market-driven world, ethanol would be priced competitively with gasoline. That has never been true in the entire history of the industry."

But ethanol groups countered that claim, clarifying the amount of corn that is used to make ethanol isn't always correctly represented.

"While our critics have said the ethanol industry uses a significant portion of the corn crop, if you look beyond simple volume of corn and into the net corn acreage used, the industry actually only utilizes 17.5 percent of the acres because of displacement of corn and soybean meal through the use of distiller grains as a high protein animal feed."

The House Energy Committee will continue to solicit comments to three subsequent white papers from other sectors and stakeholders in the RFS discussion in the coming months. Those papers will address greenhouse gas emissions and other environmental concerns, energy policy considerations, and RIN fraud and other implementation and enforcement issues.

In addition, the Committee said, stakeholders will be provided an opportunity to comment on any issues not specifically addressed in the white papers at the conclusion of the process.

In its first request, the Committee explained, "It has been more than five years since the RFS was last revised, and we now have a wealth of actual implementation experience with it … the overall energy landscape has changed since 2007. It is time to undertake an assessment of the RFS."

The first white paper addressed comments on the "blend wall" – the point at which adding the required volume of ethanol to gasoline supplies would result in ethanol blends that exceed 10%, which is the maximum ethanol content approved for sale for use in all vehicles.

Read more:

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Renewable Fuels Standard, Biofuels Continue to Take Hits

Renewable Fuels Standard Question Isn't Dead

RFS Questioned as Livestock and Ethanol Producers Butt Heads