New University Analysis (CARD): No Changes Needed to 2014 and 2015 Renewable Fuel Requirements

[Bill USA]

... of course, none of the discussion below addresses the real reason for cutting the RFS blending requirements: to safeguard Oil industry sales and profits. LOL!


http://www.ethanolrfa.org/news/entry/new-university-analysis-no-changes-needed-to-2014-15-renewable-fuel-require/

(January 3, 2014) WASHINGTON — The Environmental Protection Agency’s (EPA) proposal to slash 2014 Renewable Fuel Standard (RFS) blending requirements is unwarranted and economically irrational, according to a new analysis released today by Iowa State University’s Center for Agricultural and Rural Development (CARD). The 16-page report shows that 2014 statutory RFS requirements could be easily met with no new investment in refueling infrastructure, and 2015 requirements could be achieved with only modest infrastructure investments.

In November, EPA proposed to reduce the 2014 requirement for renewable fuel by 10 percent from the statutory level of 14.4 billion gallons to just 13 billion gallons. The Agency cited the so-called E10 “blend wall” as the key factor in its decision to propose the cut.

According to CARD economists Bruce Babcock and Sebastien Pouliot, “…the assumption by EPA that a 14.4 billion gallon ethanol mandate in 2014 was not feasible is not correct. …meeting a 14.4 billion gallon ethanol mandate is feasible in 2014 with no new stations, modestly lower E85 prices, and judicious use of available carryover RINs.”

The analysis clearly details why setting the 2014 blending requirements below the so-called “blend wall” results in a self-fulfilling prophecy that stunts any future growth potential in domestic ethanol consumption. In essence, EPA’s proposal would kill the economic incentive provided by Renewable Identification Number (RIN) credits to expand E15 and E85 refueling infrastructure.
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