Biofuels industry group pushes lawmakers on corn ethanol views

BIO has reached out to lawmakers such as Sen. James Inhofe (R-Okla.) and Rep. Brian Bilbray (R-Calif.), who both promote advanced biofuel research, BIO Managing Director Matt Carr told E2-Wire on Thursday.

Those lawmakers sponsor legislation that would let states opt out of meeting the renewable fuel standard (RFS) requirement of blending 13.2 billion gallons of corn ethanol into traditional fuel this year, Carr said.

“We want to make sure there are not unintended consequences in altering the program,” Carr said.

Carr said tinkering with that would spook investors in advanced biofuels, which are generally understood as those made from non-food products such as switchgrass and algae.

“If you look at some of the members on those bills, some of them are the biggest advanced biofuels champions,” Carr said. “So we’ve been trying to educate them on how it’s all tied together.”

BIO has not used lobbyists for the effort, Brent Erickson, executive vice president with BIO, told E2-Wire on Thursday. BIO spent $2.07 million on lobbyists in the second quarter of 2012. The RFS was one of the many issues it listed on lobbying disclosure forms.

Lawmakers have become more vociferous about ending the Environmental Protection Agency’s (EPA) RFS in recent weeks. They say drought has made the corn ethanol mandate untenable as corn stocks dwindle, making it more expensive for livestock producers to continue operations.

That rule also requires 21 billion gallons of advanced biofuels to be blended into conventional fuel by 2022, though no such fuels are currently produced at commercial scale.

Carr said the spotlight Capitol Hill has shone on the RFS invited an equal amount of concerned calls from corn ethanol and advanced biofuels investors.

The availability of advanced biofuels could soon change, as biofuels firm INEOS Bio on Thursday was granted the nation’s first registration for the commercial production and sale of such biofuels at its Florida plant. Mississippi-based firm KIOR also got permission to sell its advanced biofuel on Thursday.

INEOS Bio said in a statement that it will begin producing at commercial scale during the third quarter of 2012. Full production will yield 8 million gallons of the fuel, the firm said.

BIO contends that the advanced biofuels industry is just about to hit its stride, so preserving investor confidence is essential. The group says advanced biofuels will directly create 29,000 jobs this year and 190,000 by 2022.

The oil-and-gas industry is less bullish on those jobs numbers.

The American Petroleum Institute (API) filed a lawsuit against EPA last month for imposing the advanced biofuel mandate even though none of it is commercially available. Importers and refiners had to buy 6.6 million gallons worth of credits this year to meet EPA’s target, even though the agency noted there were no gallons to purchase.

That means the RFS has failed to have the kind of influence biofuels supporters say it possesses, Carlton Carroll, an API spokesman, told E2-Wire on Thursday. He explained that API has not called for an end to the RFS and is only asking to make changes that better reflect current market and production conditions.

“I should point out that EPA’s absurd mandates for cellulosic biofuels have not stimulated the growth of these fuels,” Carroll said in an email. “While we expect these fuels to be available at some point (and our members are investing in them now), setting absurdly high mandates has proven to not stimulate the production of these fuels.”