GOP lawmakers: Renewable fuel rule hurting economy

Republican members of Congress took aim at an environmental regulation requiring that gasoline be mixed with biofuel, claiming it kills jobs and is hurting American families.

Legislators were split along party lines over the renewable fuel standard for gasoline on Wednesday. The standard, administered by the Environmental Protection Agency (EPA), calls for increased levels of biofuel to be mixed into transportation fuel, though some car companies warn new levels aren't safe.

The standard was created under the 2005 Energy Policy Act and requires 36 billion gallons of renewable fuel to be blended into transportation fuel by 2022.

Industry representatives and Republicans on the House Oversight and Government Reform Committee's Energy Policy, Health Care and Entitlements subcommittee claimed that the standard was increasing the cost of gas at the pump.

"By requiring refiners to produce a product that consumers can’t use and don’t want, it is only logical that this constriction of the market will increase fuel prices, causing economic damage," said Rep. James Lankford (R-Okla.), the subcommittee's chairman.

Diverting ethanol for gasoline also increases demand for corn and raises the cost of turkeys, chickens and other livestock that eat it, said Joel Brandenberger, president of the National Turkey Federation.

Additionally, some legislators worried the standard would force oil industry workers out of their jobs. "You can destroy the refineries in my backyard overnight, because all they need is a couple of years of losing $150 million or more and they shut down," Rep. Pat Meehan (R-Pa.) said. "And when you close a refinery it doesn't come back."

Republicans wanted the EPA to waive the standard, as it has the authority to do if the regulation's impacts are sufficiently severe. The agency does not have a specific metric to measure how severe impacts would have to be to necessitate a waiver, however, a lack of guidance that some legislators criticized.

"The fact is you don't have to have a perfect definition, but if you don't have anecdotal examples of what is [severe] then you failed the most important test," said Rep. Darrell Issa (R-Calif.), chairman of the full Oversight Committee. "You've got to say 'this is out of bounds and this is in bounds.' Even the IRS had examples," he added, referring to the tax agency's targeting of conservative political organizations.

Rep. Jim Jordan (R-Ohio) added to the agency's scolding. "This is as obvious and as plain and as simple as it can be," he said. "You guys have the authority to help every single family in this country and you won't do it."

The standard is part of a program to cut American dependence on oil and harness new energy resources, which Democrats on the panel called a necessity.

"Keeping the renewable fuel standard on track is critical if America is to succeed in the clean energy race of the 21st Century," argued Rep. Jackie Speier (D-Calif.), the panel's top Democrat.

She added, "We cannot just dig our heads in the sand here."

"We didn't build the oil industry overnight," said Jeremy Martin, a senior scientist with the Union of Concerned Scientists' clean vehicles program. "Between now and 2015 we're not going to build a cellulosic biofuel industry that's the scale of the oil industry. We need a steady path forward."

Since 2011, the EPA has allowed gasoline comprised of up to 15 percent ethanol, known as E15, to be sold. Many cars are not prepared to handle that gasoline, however, which industry advocates fear could lead to a "blend wall" where refiners are creating a fuel that consumers cannot buy.

Jack Gerard, president and chief executive of the American Petroleum Institute, told the panel that "millions of automobiles could face engine and fuel systems damage," posing "an unnecessary risk to consumer safety, automobiles and small engines."

Though the EPA has declared that E15 is safe for cars made after 2001, many automobile manufacturers urge owners not to use the gas.

In his 2011 vehicle, Lankford said "I am already having notifications and a sticker on my gasoline lid that reminds me if I use E15 in this, that my warranty is void."

"Congress anticipated that the market would solve this problem" when it passed the Energy Policy Act, said Christopher Grundler, the director of the EPA's transportation and air quality office. "Clearly the market has not solved this problem yet."

This summer, the EPA plans to make a decision for this year's fuel standards, he added, but could not provide a specific date.

If there are problems with the program, some Democrats on the panel said legislators should blame Congress, which passed the law, not the EPA.

"To suggest that EPA should indiscriminately choose which laws to properly implement and which it shouldn't I think is questionable," said Rep. Steven Horsford (D-Nev.).

-- This story was updated at 10:34 a.m. on June 6 to clarify which year's standards the EPA is currently considering.