By John M. DeCicco, Energy Institute and School of Natural Resources and Environment, University of Michigan
Renewable fuels such as ethanol and biodiesel were long hailed as alternatives to petroleum. These biofuels bolster corn and soybean farmers' incomes and claimed to protect the climate by recycling carbon from the air. As prices at the pump climbed over the previous decade, biofuel proponents lobbied to replace oil with home-grown biofuels. Some major environmental organizations — enthralled by the prospect of growing energy instead of drilling for it and lulled by lopsided studies touting biofuels' benefits — threw their weight behind the effort.
In response, Congress created the RFS in 2005 with an original target of seeing 7.5 billion gallons of ethanol blended into the fuel supply by 2012. That would have been a safe goal, one that could be met by blending ethanol at levels below the 10 percent limit compatible with most of the cars already on the road and millions of small gasoline engines in motorcycles, lawn and garden equipment, home generators, boats and many other items.
But that wasn't enough for some interests. With the ink barely dry on the original RFS, biofuel boosters teamed up with energy security hawks and several green groups to promote a bigger mandate. They worked with allies in Congress to craft a vastly expanded RFS, giving biofuel producers and financiers a massive guaranteed market that more than quadrupled the original target. The result was EISA's ambitious goal for 15 billion gallons of renewable fuel in 2012 — a milepost on the road to 36 billion gallons by 2022.
Even at last year's level, this ethanol requirement consumed 45 percent of the U.S. corn crop. Although some biofuel byproducts do go to cattle feed, this degree of food-to-fuel diversion impacts grocery prices at home and hampers hunger relief efforts globally. The current and upcoming RFS targets will further distort the price of grains, putting many poultry and livestock farmers at risk while putting added pressure on food prices around the world.
The RFS also calls for the use of cellulosic ethanol made from non-food crops and wastes. It was thought that the necessary production technologies would become commercially competitive after a few years of subsidy, but engineering realities have proven those presumptions wrong. No cellulosic fuel was blended in 2010 and 2011, and just 20,000 gallons were blended in 2012. For 2013, EPA trimmed the cellulosic mandate to 14 million gallons, a far cry from the one billion gallons called for by EISA. Moreover, the global warming risks of both corn ethanol and much of the promised cellulosic biofuel are worse than many environmentalists wanted to believe.
It's now clear that the rising RFS targets were a dangerous overreach. Congress should strike its 2007 provisions, reverting to the original and more sensible 7.5 billion gallon goal. Doing so still provides a guaranteed market for truly competitive advances in biofuels while making more of our harvest available for food and feed. Meanwhile, higher vehicle efficiency standards and new petroleum production techniques offer more economical pathways for meeting America's energy needs.
In short, expansive renewable fuel mandates are a bad bet for consumers, doing little for energy security while risking food security, harming the environment and raising costs throughout the economy. It's time for Congress to scale the RFS back to a prudent and realistic level.
DeCicco holds professorial appointments at the University of Michigan's Energy Institute and School of Natural Resources and Environment.