The writer, of Perry, Iowa, is a farmer and a member of the National Biodiesel Governing Board.
President Donald Trump has said many times in speeches in Iowa that he is a strong supporter of renewable fuels. Unfortunately, his Environmental Protection Agency’s actions on the Renewable Fuel Standard are speaking louder than his words.
America’s farmers produced record crops the past several years, yet still face an economic crisis. Commodity prices are the lowest they’ve been in a decade.
Farm income is down by half because in trade wars, U.S. farmers are the consistent target of foreign countries. The export markets that have accounted for over one-fifth of all U.S. farm sales in past years have been upended.
The decline in farm income will quickly unravel farm economies. Farm equipment purchases are already declining. And commercial lenders are tightening farm credit, with farm debt already at a record $426.7 billion. The longer the economic downturn continues, the more difficult it will be for farmers to recover. They won’t participate in the economic growth that the rest of the country is enjoying.
EPA is finally breaking down one of its own regulatory barriers to allow year-round sale of E15. That’s long overdue. But there’s far more the agency should do to support farm incomes and the rural economies that are important to the president. EPA must raise RFS volumes for next year and cease issuing retroactive small refinery exemptions.
According to news reports, EPA is preparing to release a proposal that would hold RFS volumes for 2020 at the same levels as 2019. There is plenty of room for growth in advanced biofuels such as biodiesel.
Because of last year’s record soybean harvest and the continuing disruptions in trade, there is a glut of U.S. soybean oil in storage. The biodiesel industry got its start in the 1990s because farmers needed a new market for surplus soy oil. U.S. storage of soybean oil right now looks a lot like it did back then. Already, fewer farmers plan to grow soybeans this season –- even if the weather permits.
EPA is also preparing to actively roll back the existing RFS volumes with another round of retroactive small refinery exemptions. Because the agency has exempted every refinery that asked the past several years, they’ve now got a record 40 exemption petitions for 2018.
If the agency continues to grant exemptions for years that have already ended, it will compound the damage to Iowa’s farmers and biodiesel producers. While retroactive exemptions hurt all renewable fuels, the damage to biodiesel is substantial. EPA has already destroyed demand for more than 360 million gallons of biodiesel with these exemptions. That’s more than Iowa’s yearly production.
EPA must fix these problems that it has created. Last year, as EPA finalized the annual RFS rule, the agency calculated it wouldn’t grant any small refinery exemptions for 2019. No one believes that to be true.
We know that EPA is capable of avoiding harm to the renewable fuel industry. In the proposal for 2020, the agency can and should include an upfront good-faith estimate of the gallons they will exempt for small refiners.
Iowans believe that President Trump is a strong supporter of renewable fuels. But actions always speak louder than words, and EPA’s actions are undermining biodiesel