Big Corn and Big Oil have been dueling over the future of the Renewable Fuels Standard, which requires oil refiners to mix biofuels like corn-heavy ethanol into their fuel. The Renewable Fuel Standard requires refineries to blend increasing volumes of biofuels into their fuel each year. The proposed plan would include an increase to biofuels requirements for 2020 of 1 billion gallons (3.8 billion liters) and the agricultural industry wants the administration to force larger refineries to make up for the exempted gallons through reallocation. The proposed plan, discusses 500 million gallons for conventional biofuels and 500 million gallons for advanced biofuels (like biodiesel).
Back in early September, The American Petroleum Institute urged the administration to reject proposals from the U.S. farmers and ethanol producers to boost ethanol demand. “We are deeply concerned by the RFS (Renewable Fuel Standard) policy changes the White House is currently considering,” said Frank Macchiarola, API’s vice president of downstream and industry operations. “We hope the administration walks back from the brink of what would be a disastrous political decision that potentially hurts American drivers.”
Under current policy, more than 30 oil refineries are exempt from their U.S. Renewable Fuel Standard mandate to blend corn-based ethanol with other biofuels. Agriculture advocates argue the exemptions hurt farmers who produce corn-based ethanol and are who are already taking losses as a result of the ongoing U.S.-China trade war. Oil industry experts, however, say the exemptions are intended to save refining jobs. The Environmental Protection Agency (EPA) has stopped working on the update according to Reuters. With the President turning his attention away from the deal (for now), the fear is the policy reform won’t be completed before the end of the year.