Next-wave ethanol falls short in EPA's new 2012 fuel standards

The Environmental Protection Agency proposed federal renewable fuel standards for 2012 on Tuesday that acknowledge the next generation of ethanol hasn’t taken off nearly as quickly as Congress hoped several years ago.

The agency on Tuesday floated draft standards to comply with a 2007 law that mandates escalating annual increases in the amount of renewable fuels blended into the nation’s fuel mix, reaching 36 billion gallons in 2022.

The standard includes escalating targets for cellulosic fuels, which refers to next-generation renewable fuels made from non-food crops and other substances that are seen as more environmentally friendly than traditional corn ethanol.

But the market for these next-wave fuels hasn’t grown nearly enough to meet the targets established in 2007. EPA’s proposed 2012 standard sets the cellulosic ethanol level at 3.45 - 12.9 million gallons for the year, well below what was envisioned in the 2007 law.

“Based on analysis of market availability, EPA is proposing a 2012 cellulosic volume that is lower than the [Energy Independence and Security Act] target for 2012 of 500 million gallons. EPA will continue to evaluate the market as it works to finalize the cellulosic standard in the coming months,” a summary of the proposal states.

“The agency remains optimistic that the commercial availability of cellulosic biofuel will continue to grow in the years ahead,” EPA said.

The Advanced Ethanol Council, in a statement, called for policies that will help boost cellulosic ethanol production.

“America needs the same kind of forward-looking tax policy to ensure these technologies can commercialize and compete in marketplace where oil production is still subsidized,” Brooke Coleman, the group’s executive director, said in a statement.

“The most immediate term solution to this problem is to enact meaningful and long-term tax incentives to spur construction of the first-commercial advanced biofuel plants, in much the same way that Congress has stood behind oil and gas production for nearly 100 years,” Coleman added.

Overall, EPA’s proposal calls for use of 15.2 billion gallons of renewable fuels in 2012, consistent with the overall mandate, the great bulk of which comes from corn ethanol.