This year's drought has seriously reduced corn yields but the EPA says "tough." Requests for waivers from the Renewable Fuel Standard have been turned down by the agency which says the EPA has "not found evidence to support a finding of severe 'economic harm' that would warrant granting a waiver" to states.
Opponents of the RFS say drought-driven spikes in corn prices and reduced harvests should prompt the agency to relax the requirements, which require refiners to blend billions of gallons of ethanol into gasoline.Livestock, poultry and food industry groups dismayed at the amount of corn used for ethanol have joined states in calling for EPA to back off the ethanol mandate. EPA also faced congressional pressure to ease the requirements.
But EPA tossed aside their arguments.
"We recognize that this year's drought has created hardship in some sectors of the economy, particularly for livestock producers," said Gina McCarthy, EPA's top air regulator, in a statement. "But our extensive analysis makes clear that Congressional requirements for a waiver have not been met and that waiving the RFS will have little, if any, impact," she said.
The ethanol industry applauded EPA's decision.
Renewable Fuels Association President Bob Dinneen lauded EPA for "basing its decision on thoughtful analysis of the facts and not emotion or panic," and said the fuel standard is working as designed.
"The flexibility that is built into the RFS allows the marketplace to ration demand, not the government. Indeed, the ethanol industry has responded to the market by reducing output by approximately 12%. Other users of corn have responded to a lesser degree," he said in a statement.
EPA is requiring 13.2 billion gallons of ethanol to be blended into gasoline in 2012, rising to 13.8 billion next year.
The decision drew quick attacks from food groups and environmentalists.
"This year's catastrophic drought seriously reduced corn yields and has lead to a situation where the RFS' unsustainable mandates force ethanol fuel to commandeer a shrunken pool of available corn for food and livestock feed," said Rob Green, executive director of the National Council of Chain Restaurants.
Something is seriously wrong with a federal agency that thinks it's more important to feed cars than feed people.