Thread: Trump ups the ante in Iowa, calls for more ethanol blending in gas

Trump ups the ante in Iowa, calls for more ethanol blending in gas

POSTED AT 12:41 PM ON JANUARY 20, 2016 BY JAZZ SHAW

We must be getting close to a very tight finish in the Iowa caucuses less than two weeks from now. How can you tell? Donald Trump decided to step up to the plate and double down on ethanol mandates, calling for the government for force even higher levels of blending. (The Hill)

Donald Trump said Tuesday that federal regulators should increase the amount of ethanol blended into the nation’s gasoline supply.

Speaking at an event hosted by the Iowa Renewable Fuels Association, Trump, a real estate mogul and the front-runner for the Republican presidential nomination, said the Environmental Protection Agency (EPA) ought to follow the ethanol volumes Congress set in 2007.

“The EPA should ensure that biofuel … blend levels match the statutory level set by Congress under the [renewable fuel standard],” Trump said.

The mandate is popular in Iowa, which hosts the nation’s first caucuses.

While I entirely disagree with this position (obviously) you can at least give Trump credit for consistency here. He bailed out on conservatives on the ethanol mandate issue pretty much the moment he entered the race. Now, however, facing a close challenge from Ted Cruz in Iowa, Trump seems to be turning up the heat and promising Iowa voters that he’ll use the Renewable Fuel Standard as an even larger hammer to bash the free market.

Speaking of Cruz, while he did write an op-ed in December which was a very big sop to the ethanol lobby, that didn't seem to be enough for Terry Branstad. The Governor wasn’t exactly endorsing anyone yesterday, but he did make it clear that the one person he did not want to see taking the victory lap in Iowa was the Texas Senator.

Speaking with with reporters Tuesday at the Iowa Renewable Fuels Summit, Gov. Terry Branstad (R) said voters should oppose Cruz when they turn out to caucus next month, calling him the “biggest opponent of renewable fuels” in the presidential race.

“He’s heavily financed by Big Oil,” Branstad said, according to the Des Moines Register. “So we think once Iowans realize that fact, they might find other things attractive but he could be very damaging to our state.”

Cruz “hasn’t supported renewable fuels, and I think it would be a big mistake for Iowa to support him,” Branstad added. Asked whether he wanted to see Cruz defeated, Branstad said “yes.”

This might be a good time to bring up yet another uncomfortable fact which I think most of the candidates are getting wrong when it comes to the Renewable Fuel Standard, and I don’t think it’s intentional on their part. It’s a complex subject which we all learn a little more about every week, or so it seems. But when Ted Cruz (and others, though not Trump) talk about letting the RFS lapse in five years, that’s not what’s actually going to happen. Michelle Ye Hee at the Washington Post had a good, though extremely wonky piece a couple of weeks ago which truly deserves a read for anyone following this issue. Without action by not only the next president, but Congress as well, the RFS isn’t about to go away on its own. In fact, depending who is at the helm at the EPA, the mandated ethanol usage levels may actually go up after five years. That 2022 figure everyone keeps citing came from a table found in the Energy Independence and Security Act of 2007. The table ends at 2022, but that doesn't mean the legislation does.

As you can see, the table stops at 2022. This is what most people are referring to when they say that the RFS is “set to expire” in 2022.

But this is misleading rhetoric. The mandate doesn’t go away at all. In fact, statutes require after 2022, the Environmental Protection Agency set the minimum levels through regulations. The EPA administrator must use six criteria to set the new standard beyond 2022, such as the impact of renewable fuels on the energy security in the United States and on the cost of gasoline for consumers.

The law also makes it clear that the new levels set by the EPA can’t be lower than the amount required for 2022. [Update: We had written that EPA can’t lower the amount beyond 36 billions of gallons of renewable fuel. But EPA does have the discretion to reduce the number because it has reset authority. EPA has not used this authority to date.]

This isn't to say that Cruz is “wrong” on the subject (he was back out on the trail in New Hampshire this morning saying how the ethanol lobby is still attacking him) and that it couldn't be phased out, but it’s not going to happen on its own. And it will require the next president to put people in place at the EPA who are willing to take the required actions to reduce levels. To make it go away entirely is going to literally require an act of Congress as well as the support and signature of the next POTUS. Just something to keep in mind as this debate moves forward.

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