Rep. Welch: Ethanol mandate 'killing' farmers

Rep. Peter Welch (D-Vt.) urged his colleagues to remove a corn-based ethanol mandate from the Renewable Fuel Standard (RFS), saying the mandate hurts a diverse range of people and businesses including farmers, small engine users and restaurants.

Dairy farming is a major industry in Vermont. Welch said the ethanol mandate, which started in 2005, has created a new demand for corn and other grains and raised feed costs for livestock farmers.

“They were telling me about how much their grain costs were going up, and it’s killing them,” Welch said Thursday at a policy forum on the RFS hosted by The Hill. “And they were attributing that to ethanol.”

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The RFS, administered by the Environmental Protection Agency, requires that fuel refiners blend a certain amount of renewable fuels per year into their gasoline and diesel. It specifically requires a some level of corn-based ethanol.

Welch started to oppose the RFS shortly after he began serving Vermont’s at-large congressional district in 2007. He told a story about how ethanol once wrecked a chainsaw he owned.

“I left it with the gas in, and I couldn’t get it started, and I was pretty blue about it,” Welch said. “I brought it into my small engine guy, Lloyd, and he said ‘Peter, you left the ethanol in there, and it wrecks it.’ ”

The increased food costs that hurt livestock farmers also hurt restaurants, Welch said.

Citing the original RFS goals of reducing carbon emissions and using cleaner fuels, Welch called the mandate “a well-intentioned flop.”

Meanwhile, the environmental benefits that RFS supporters predicted have not been borne out, he said. The mandate hasn’t significantly reduced emissions and it’s caused 23 million acres of land — the size of Indiana — to be farmed for the first time.

Furthermore, the energy it takes to produce ethanol is close to the amount of energy in the fuel.

“Many studies suggest that it’s in the negative or barely positive,” Welch said. “But it’s close. It’s not this huge benefit in renewable fuel that had originally been advertised.”

Welch has sponsored a bill to repeal the corn-based ethanol requirement, while leaving the advanced biofuel mandate in place.

Following Welch’s comments, Paul Bledsoe, president of public policy firm Bledsoe and Associates, moderated a panel of stakeholders who oppose the corn-based ethanol mandate.

The National Council of Chain Restaurants commissioned research that found that the mandate increased food costs by $3.2 billion a year for chain restaurants.

“It affects poultry, beef, pork, other agricultural products. And at a local level ... it costs $18,000 a year for each restaurant because of the RFS,” said Rob Green, executive director of the group. “And if you sell more beef, it can be as high as $35,000 a year per restaurant.”

Scott Faber, vice president of government relations at the Environmental Working Group, said corn-based ethanol emits more pollutants when burned than gasoline, while causing wetlands to be converted for agricultural use.

Dominic Albino, a scholar with the New England Complex Systems Institute, said his organization found a link between the RFS and a rise in global conflict.

“Our research has also shown that, since 2005, the major drivers of increased food prices are conversion of corn to ethanol and financial speculation in food commodities,” Albino said.

Michael McAdams, president of the Advanced Biofuels Association, said the fight over ethanol has hurt his industry, which uses woody sources that do not interfere with the food supply.

“We’ve become the collateral damage association, because we’ve had this unbelievably focused, pitched debate between these two behemoth industries,” McAdams said. “It’s created a cloud in the financial community to have the confidence to make the investments in the people I represent.” 

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