EPA Official Says Exceeding 10% Ethanol in Fuel Not Feasible

The Environmental Protection Agency determined that it’s not feasible for gasoline refiners to use as much ethanol next year as had been mandated, which is why the agency proposed easing the requirement, an EPA official said.

Christopher Grundler, the director of the office responsible for the program, said the agency wants to analyze ways the industry could increase the use of biofuels in coming years.

The intention of the proposal is to put the Renewable Fuel Standard “back on a long-term trajectory,” Grundler told the Senate Environment and Public Works panel today.

Producers of ethanol, biodiesel and advanced biofuels have criticized the EPA’s proposal, saying it undercuts a growing, domestic industry. Oil refiners, corn consumers and some environmental groups say the EPA’s plan doesn’t go far enough, and have pushed Congress to revamp or repeal the mandate.

“If we get it right, maybe the temperature can drop,” Grundler said, referring to the intense lobbying that has surrounded the issue.

He predicted that production of cellulosic biofuels, which Congress predicted would ramp up quickly following passage of the legislation in 2007, is now starting to “take off,” and said the administration of President Barack Obama is committed to maintaining the program.

Lawmakers Probe

Lawmakers probed Grundler today about the EPA’s proposal last month to cut the requirements for ethanol, biodiesel and other biofuels. Some senators, such as Louisiana Republican David Vitter, said the shortfall in production of cellulosic ethanol shows that the entire requirement should be scrapped. Others, such as Nebraska Republican Deb Fischer criticized the EPA’s proposed cut of the ethanol mandate.

The divide shows the difficulty Congress will have developing -- and passing -- any legislation to change or end the current measure.

Separately today, Rhode Island Democrat Sheldon Whitehouse criticized EPA’s plan to hold down the requirement for biodiesel in 2013. When paired with the possibility that a tax break for biodiesel will expire next year, that would harm a fuel that doesn’t present “blend wall” issues, he said.

“We made the policy decision that biomass-based diesel can compete very effectively” with other advanced biofuels, Grundler said.

To contact the reporter on this story: Mark Drajem in Washington at mdrajem@bloomberg.net

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