RFS picture unclear

RFS picture unclear

AT the end of more than 12 hours of public testimony on proposed renewable fuel volume obligation levels, the final witness rightly characterized the day as resembling a gigantic ping pong match, with a wide disparity in comments from those on the right and left.

Although most headlines paint the biofuel issue as divided between livestock producers and oil companies pitted against corn, soybean and biofuel producers, that wasn't necessarily the case.

The testimony revealed the glaring reality that the issue has consequences and benefits on both sides.

Mike Brown, president of the National Chicken Council, started off the day testifying on the $8.8 billion per year feed cost increases the industry has experienced since 2007 and noted how more than a dozen poultry companies have filed for bankruptcy, been sold or simply closed their doors altogether.

However, Mark Leonard testified that as a cattle feeder, cow herd operator and rural banker in western Iowa, he has seen firsthand the positive impacts of the RFS.

"Our feed mills, livestock equipment manufacturers, veterinarians, auto dealerships, restaurants, movie theaters, hardware stores and construction outfits have seen increased and sustained vigor in their businesses," he said.

It's hard to deny that the RFS has brought renewed life in rural America, especially at a time when net farm income has increased 51% while federal farm payments have decreased 57%. Several witnesses reiterated that a wrong decision by EPA could send agriculture into a farm crisis similar to in the 1980s.

The challenge will be for EPA to make sure it carries out the intent of Congress while also using its discretion properly to set the right direction for U.S. energy policy.

Timothy VerVaecke, chief operations officer at Global Alternative Fuels LLC, testified that EPA has been given the task of doing something fair and equitable while moving in the direction charged by Congress. "I don't know how you're going to do that and satisfy everyone," he said.

He added that after sitting through a daylong discussion, no commitment was expressed by those testifying from oil companies and biofuel producers and all those people in between to work together.

It's disappointing that agriculture is unable to see that it needs to be in this together and find an equilibrium.

Oil companies have not been on board with losing some of their market share since day 1 of finalizing energy policy that called for increased production of renewable fuels.

Johnathon Lehman, counsel to former Senate majority leader Tom Daschle (D., S.D.), was tasked with crafting the RFS and negotiating its language in 2005. He said he fought attempts by the oil industry to insert poison pills — "waiver language so deadly to the RFS that it was soundly rejected by Congress" — but he testified that the same language Congress rejected in 2005 now sits before the industry in "nearly identical form."

"Congress understood that providing this proposed waiver based on infrastructure was putting the very fate of the RFS in the hands of an industry bent on destroying it," Lehman said.

EPA seemed genuine in trying to get beyond the hyperbole and find answers, and at the end of the day, the agency said it was a "privilege" to hear the testimony and said that's what democracy is all about. Now, we wait to see if attaining the right balance is possible.

Volume:85 Issue:50

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