White House playing politics with biofuel
policy, oil group says
Send a link to a friend
[September 12, 2014]
By Ayesha Rascoe
WASHINGTON (Reuters) - The American
Petroleum Institute on Thursday accused the White House of attempting to
use 2014 biofuel targets to influence a tight U.S. Senate race, saying
that the Obama administration was putting politics ahead of consumer
Management of the biofuel program has taken center stage in an
election battle between Democrat Bruce Braley and Republican Joni
Braley has repeatedly pressed the administration to reverse steep
cuts proposed in November for this year's targets for the use of
fuels such as corn-based ethanol.
Bob Greco, group director of downstream and industry operations at
API, said recent statements from administration officials hinted
that a potential increase in biofuel targets from November's
proposal could be aimed at securing a victory for the Democrat.
The API contends that an increase in the targets could raise the
price of gasoline. Braley and his supporters say the targets have to
be maintained as part of efforts to reduce U.S. dependence on fossil
The election in Iowa, the top U.S. corn and ethanol producing state,
is among a handful of competitive races that could help determine
whether Democrats - Obama's party - maintain control of the Senate
Recent opinion polls show Braley holding a small lead over Ernst,
but within the margin of error, and the race is regarded as a
"Harry Reid's job is on the line here," Greco said on a conference
call, referring to the Senate Majority Leader. "You're starting to
see the political calculations intrude, as opposed to what's good
for the consumer."
The Renewable Fuel Standard requires increasing amounts of ethanol
and biodiesel to be mixed into U.S. fuel supplies each year until
API has argued that the targets must be cut to avoid a collision
with the blend wall, the point when the law will require ethanol to
be blended into gasoline at levels higher than the 10 percent
per-gallon mixture that dominates retail fuel stations.
Breaching the blend wall could lead to dramatically higher
compliance costs for refiners, which oil companies contend would
eventually be passed on to consumers.
[to top of second column]
Ernst, a Republican, has said she supports the federal biofuel
program. But she has faced criticism from some ethanol backers who
say she is too close to the oil industry, which favors repealing the
Renewable fuel companies fighting to preserve the biofuel mandate
blame the oil industry for the fuel infrastructure restraints.
Restoring the biofuel use targets to levels contained in the
original RFS statute would force oil companies to invest in new fuel
pumps that can support higher blends, they argue.
"The RFS is supposed to push us over the blend wall," said Brent
Erickson, of the Biotechnology Industry Association (BIO), on a call
Thursday sponsored by a coalition of biofuel supporters.
When asked about API's contention that the Iowa race was affecting
biofuel policy, Jon Doggett, vice president of public policy with
the National Corn Growers Association, said it is not surprising
that politics could play a role in the administration's decision.
Political angles are "being played all over, by all sides," Doggett
(Reporting by Ayesha Rascoe, editing by Ros Krasny and Andrew Hay)
[© 2014 Thomson Reuters. All rights
Copyright 2014 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.