Democratic Presidential Hopeful Klobuchar Proposes Revamping EPA Ethanol Rules

Klobuchar
Eric Miller/File Photo/Reuters

Democratic presidential hopeful Amy Klobuchar on Saturday called for revamping the Environmental Protection Agency’s (EPA) rules governing how small refineries are exempted from the nation’s biofuel laws, a proposal aimed at boosting her standing in the politically critical state of Iowa.

Part of a series of farm policies that also addressed access to capital and bankruptcy assistance, Klobuchar, a U.S. senator, said EPA waivers that allow small refineries to avoid the requirements are “misguided” and said financial institutions are manipulating the biofuels credit trading market.

She called for new compliance standards and additional oversight.

Klobuchar is one of more than 20 Democrats vying for her party’s presidential nomination. If she is going to be successful, her campaign needs to galvanize support in the agriculture-focused state of Iowa, which holds the first primary contest in the nation. Iowa grows most of the country’s corn, which is used to produce ethanol.

Klobuchar, who represents Minnesota, another agriculture powerhouse bordering Iowa to the north, in the U.S. Senate, has been trailing in polls on the Democratic presidential field.

In a Reuters/Ipsos poll earlier this month, she garnered support of only 1% of respondents. Former Vice President Joe Biden led the poll, with 29% of Democrats and independents saying they would vote for him in the state nominating contests that begin next winter.

The Renewable Fuel Standard (RFS) program that mandates ethanol use is a more than decade-old regulation aimed at helping farmers and reducing U.S. dependence on oil. The policy has helped farmers by creating a huge market for ethanol and other biofuels, but oil refiners say compliance is prohibitively expensive.

Under the program, refiners are required to blend biofuels into the nation’s gasoline pool or purchase credits from those that do, but smaller refineries with a capacity of less than 75,000 barrels per day (bpd) can obtain a “hardship waiver” if they prove that compliance with RFS would cause them significant financial strain.

The Trump administration has made extensive use of such waivers in the last two years, saving refiners money but angering the corn lobby, particularly after major companies like Exxon Mobil Corp received exemptions for certain facilities.

Ethanol mandates have opened a war between the oil and corn industries. The ethanol industry claims the exemptions have been over-used, threatening demand for corn-based ethanol at a time when farmers are already struggling.

The policy has helped farmers by creating a 15-billion-gallon-a-year market for corn-based ethanol, but oil refiners have increasingly complained about the expense – particularly when prices are high and volatile.

RFS and the small refinery waiver program have increasingly emerged as one of the key policy areas that several Democratic presidential hopefuls have raised.

Senator Elizabeth Warren earlier this month in a letter to the EPA questioned the agency’s decision to grant a small refinery waiver to an oil refinery owned by billionaire Carl Icahn, a former adviser to President Donald Trump. She said waivers undermine the renewable program.

Klobuchar also said she would support year-round sales of E15, gasoline blended with 15 percent ethanol, a rule that the Trump administration has promised to farmers and that the EPA is working to complete by June 1.

(Reporting by Humeyra Pamuk and Ginger Gibson; Editing by Leslie Adler and Sonya Hepinstall)

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Susan
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Susan

Disregard my comments. Somehow I was commenting on Ben Carson’s hearing in congress, and this was NOT the same strain.

Susan
Guest
Susan

Constantly the goal of these interrogations gets off subject. Secretary Carson needs to understand the question and in trying to clarify to her, she is ready to jump on him and call him stupid. There is nothing at all stupid or unqualified about Ben Carson. He would have made the BEST President ever. I am sad, like him, that there cannot be more dignity in these hearings. He has the answers but he’s not there to answer poorly phrased or insinuative questions. He has better things to do. Is there an ISSUE with what she’s asking? Is it important to… Read more »

George Washington
Guest
George Washington

Corn based ethanol in gasoline is detrimental to many older cars and engines and is complete b.s. political pork barreling today! Shame on her!

Kim Manley
Guest
Kim Manley

Do any of the Demoncrats have a clue?

Thomas Clark
Guest
Thomas Clark

REVAMPED… how about do away with ETHANOL. Making it and using it causes more pollution than straight gas. I use half the gas in all my small engines

Erock
Guest
Erock

No environmental group is for corn ethanol. She on the wrong side.

Glenn Darr
Guest
Glenn Darr

ethanol production is just a way to waste energy. It takes more energy to produce a gallon of ethanol than the amount of energy you get from that gallon of ethanol. If I was President, gasoline would not have 1 ounce of ethanol in it. Farmers can grow other crops, namely crops used for food!

DA Swanson
Member

– Anyone who thinks ethanol is good for the environment doesn’t know much about ethanol.
– Anyone who thinks ethanol is about the environment doesn’t know much about the environment.
– Anyone who thinks ethanol is good for farm soils or water doesn’t know much about farming.

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