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21–552 2017

THE RENEWABLE FUEL STANDARD: 

IMPLEMENTATION ISSUES 

HEARING 

BEFORE THE

SUBCOMMITTEE ON ENERGY AND POWER 

OF THE

COMMITTEE ON ENERGY AND 

COMMERCE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTEENTH CONGRESS 

SECOND SESSION 

JUNE 22, 2016 

Serial No. 114–155 

( 

Printed for the use of the Committee on Energy and Commerce 

energycommerce.house.gov 

(II) 

COMMITTEE ON ENERGY AND COMMERCE 

FRED UPTON, Michigan 

Chairman 

JOE BARTON, Texas 

Chairman Emeritus 

ED WHITFIELD, Kentucky 

JOHN SHIMKUS, Illinois 

JOSEPH R. PITTS, Pennsylvania 

GREG WALDEN, Oregon 

TIM MURPHY, Pennsylvania 

MICHAEL C. BURGESS, Texas 

MARSHA BLACKBURN, Tennessee 

Vice Chairman 

STEVE SCALISE, Louisiana 

ROBERT E. LATTA, Ohio 

CATHY MCMORRIS RODGERS, Washington 

GREGG HARPER, Mississippi 

LEONARD LANCE, New Jersey 

BRETT GUTHRIE, Kentucky 

PETE OLSON, Texas 

DAVID B. MCKINLEY, West Virginia 

MIKE POMPEO, Kansas 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

GUS M. BILIRAKIS, Florida 

BILL JOHNSON, Ohio 

BILLY LONG, Missouri 

RENEE L. ELLMERS, North Carolina 

LARRY BUCSHON, Indiana 

BILL FLORES, Texas 

SUSAN W. BROOKS, Indiana 

MARKWAYNE MULLIN, Oklahoma 

RICHARD HUDSON, North Carolina 

CHRIS COLLINS, New York 

KEVIN CRAMER, North Dakota 

FRANK PALLONE, JR., New Jersey 

Ranking Member 

BOBBY L. RUSH, Illinois 

ANNA G. ESHOO, California 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

DIANA DEGETTE, Colorado 

LOIS CAPPS, California 

MICHAEL F. DOYLE, Pennsylvania 

JANICE D. SCHAKOWSKY, Illinois 

G.K. BUTTERFIELD, North Carolina 

DORIS O. MATSUI, California 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

JERRY MCNERNEY, California 

PETER WELCH, Vermont 

BEN RAY LUJA ́ N, New Mexico 

PAUL TONKO, New York 

JOHN A. YARMUTH, Kentucky 

YVETTE D. CLARKE, New York 

DAVID LOEBSACK, Iowa 

KURT SCHRADER, Oregon 

JOSEPH P. KENNEDY, III, Massachusetts 

TONY CA ́ RDENAS, California 

(III) 

SUBCOMMITTEE ON ENERGY AND POWER

ED WHITFIELD, Kentucky 

Chairman 

PETE OLSON, Texas 

Vice Chairman 

JOHN SHIMKUS, Illinois 

JOSEPH R. PITTS, Pennsylvania 

ROBERT E. LATTA, Ohio 

GREGG HARPER, Vice Chairman 

DAVID B. MCKINLEY, West Virginia 

MIKE POMPEO, Kansas 

ADAM KINZINGER, Illinois 

H. MORGAN GRIFFITH, Virginia 

BILL JOHNSON, Ohio 

BILLY LONG, Missouri 

RENEE L. ELLMERS, North Carolina 

BILL FLORES, Texas 

MARKWAYNE MULLIN, Oklahoma 

RICHARD HUDSON, North Carolina 

JOE BARTON, Texas 

FRED UPTON, Michigan (ex officio) 

BOBBY L. RUSH, Illinois 

Ranking Member 

JERRY MCNERNEY, California 

PAUL TONKO, New York 

ELIOT L. ENGEL, New York 

GENE GREEN, Texas 

LOIS CAPPS, California 

MICHAEL F. DOYLE, Pennsylvania 

KATHY CASTOR, Florida 

JOHN P. SARBANES, Maryland 

PETER WELCH, Vermont 

JOHN A. YARMUTH, Kentucky 

DAVID LOEBSACK, Iowa 

FRANK PALLONE, JR., New Jersey (ex 

officio) 

(V) 

C O N T E N T S 

Page 

Hon. Ed Whitfield, a Representative in Congress from the Commonwealth 

of Kentucky, opening statement ......................................................................... 1 

Prepared statement .......................................................................................... 2 

Hon. Bobby L. Rush, a Representative in Congress from the State of Illinois, 

opening statement ................................................................................................ 3 

Hon. Frank Pallone, Jr., a Representative in Congress from the State of 

New Jersey, opening statement .......................................................................... 6 

Prepared statement .......................................................................................... 7 

Hon. Fred Upton, a Representative in Congress from the State of Michigan, 

prepared statement .............................................................................................. 175 

WITNESSES

Janet McCabe, Acting Administrator, U.S. Environmental Protection Agency . 9 

Prepared statement .......................................................................................... 12 

Answers to submitted questions ...................................................................... 224 

Howard Gruenspecht, Deputy Administrator, U.S. Energy Information Administration .......................................................................................................... 15 

Prepared statement .......................................................................................... 17 

Chet Thompson, President, American Fuel and Petrochemical Manufacturers 51 

Prepared statement .......................................................................................... 54 

Bob Dinneen, President and CEO, Renewable Fuels Association ....................... 78 

Prepared statement .......................................................................................... 80 

Todd J. Teske, Chairman, President, and CEO, Briggs & Stratton Corporation ........................................................................................................................ 90

Prepared statement .......................................................................................... 93 

Brooke Coleman, Executive Director, Advanced Biofuels Business Council ...... 101 

Prepared statement .......................................................................................... 103 

Collin O’Mara, President and CEO, National Wildlife Federation ..................... 129 

Prepared statement .......................................................................................... 132 

Anne Steckel, Vice President of Federal Affairs, National Biodiesel Board ....... 146 

Prepared statement .......................................................................................... 148 

Tim Columbus, General Counsel, National Association of Convenience Stores 

and Society of Independent Gasoline Marketers of America ............................ 152 

Prepared statement .......................................................................................... 154 

SUBMITTED MATERIAL

Statement of the Biotechnology Innovation Organization, submitted by Mr. 

Kinzinger .............................................................................................................. 177 

Letter of June 21, 2016, from Commander Kirk S. Lippold, USN (Ret.) to 

Mr. Olson, submitted by Mr. Kinzinger ............................................................. 188 

Statement of the Advanced Biolfuels Association, submitted by Mr. Whitfield . 190 

Statement of Growth Energy, submitted by Mr. Whitfield .................................. 196 

Statement of the National Farmers Union, submitted by Mr. Whitfield ............ 199 

Statement of the National Council of Chain Restaurants, submitted by Mr. 

Whitfield ............................................................................................................... 202 

Statement of the Coalition for Renewable Natural Gas, submitted by Mr. 

Whitfield ............................................................................................................... 211 

Prepared statement of Hon. Steve King ................................................................ 219 

Report from the Biotechnology Innovation Organization, submitted by Mr. 

Rush ...................................................................................................................... 221 

(1) 

THE RENEWABLE FUEL STANDARD: 

IMPLEMENTATION ISSUES 

WEDNESDAY, JUNE 22, 2016 

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON ENERGY AND POWER, COMMITTEE ON ENERGY AND COMMERCE, Washington, DC. 

The subcommittee met, pursuant to call, at 10:02 a.m., in room 

2123 Rayburn House Office Building, Hon. Ed Whitfield (chairman 

of the subcommittee) presiding. 

Members present: Representatives Whitfield, Olson, Barton, 

Shimkus, Pitts, Latta, Harper, McKinley, Pompeo, Kinzinger, Griffith, Johnson, Long, Flores, Mullin, Hudson, Rush, Tonko, Welch, 

Loebsack, and Pallone (ex officio). 

Also present: Representative King. 

Staff present: Will Batson, Legislative Clerk, Energy and Power, 

Environment and the Economy; Allison Busbee, Policy Coordinator, 

Energy and Power; Rebecca Card, Assistant Press Secretary; Tom 

Hassenboehler, Chief Counsel, Energy and Power; A.T. Johnston, 

Senior Policy Advisor; Ben Lieberman, Counsel, Energy and Power; 

Brandon Mooney, Professional Staff Member, Energy and Power; 

Annelise Rickert, Legislative Associate; Chris Sarley, Policy Coordinator, Environment and the Economy; Dan Schneider, Press Secretary; Jean Fruci, Minority Energy and Environment Policy Advisor; Caitlin Haberman, Minority Professional Staff Member; John 

Marshall, Minority Policy Coordinator; Jessica Martinez, Minority 

Outreach and Member Services Coordinator; Dan Miller, Minority 

Staff Assistant; and Alexander Ratner, Minority Policy Analyst. 

OPENING STATEMENT OF HON. ED WHITFIELD, A REPRESENTATIVE IN CONGRESS FROM THE COMMONWEALTH OF KENTUCKY 

Mr. WHITFIELD. I would like to call the hearing to order this 

morning, and I would like to recognize myself for a 5-minute opening statement. 

This morning we are going to revisit the Renewable Fuel Standard, the EPA program to add agriculturally based fuels like ethanol 

and biodiesel to the nation’s transportation fuel supply. It has been 

nearly a decade since the RFS was last revised by Congress in 

2007 and a great deal has changed in the interim. Energy markets 

have evolved in ways that were not predicted back then, and RFS 

implementation has taken many unexpected turns. 

For these reasons we are conducting this hearing to assess the 

status of the RFS and I welcome both the government and stakeVerDate Nov 24 2008 12:31 Feb 23, 2017 Jkt 037690 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 114\114-155 CHRIS
2 

holder witnesses who will provide us with many perspectives on 

this multifaceted issue. And we will have two panels of witnesses 

this morning representing all sides of the issue, and I really look 

forward to the hearing. 

[The prepared statement of Mr. Whitfield follows:] 

PREPARED STATEMENT OF HON. ED WHITFIELD

This morning we will revisit the Renewable Fuel Standard, the EPA program to 

add agriculturally-based fuels like ethanol and biodiesel to the nation’s transportation fuel supply. It has been nearly a decade since the RFS was last revised by 

Congress in 2007, and a great deal has changed in the interim. Energy markets 

have evolved in ways that were not predicted back then, and RFS implementation 

has taken many unexpected turns. For these reasons, we are conducting this hearing to assess the status of the RFS, and I welcome both the government and stakeholder witnesses who will provide us with many perspectives on this multi-faceted 

issue. 

As I see it, the RFS was enacted largely for three reasons—to reduce America’s 

dependence on foreign oil, to lower greenhouse gas emissions, and to strengthen 

rural economies. Over the span that the RFS has been in place, oil imports have 

indeed declined dramatically. However, most of this trend is due to sharply increased domestic oil production—something that few imagined was even possible 

during the Congressional debates over the RFS. Little of the decline in import dependence can be attributable to the RFS itself. 

The RFS was also supposed to provide a means for significantly reducing greenhouse gas emissions, but a growing number of scientists and environmental advocates are saying otherwise. Reports from the National Academy of Sciences, the 

Intergovernmental Panel on Climate Change, the Congressional Budget Office, and 

others have all hedged on whether renewable fuels are delivering the promised 

greenhouse gas reductions. And today, we will learn more about research showing 

that the RFS may be resulting in the destruction of carbon-storing natural lands 

that are being converted into cropland. In fact, EPA’s Inspector General is currently 

investigating whether the agency has been ignoring these and other scientific developments that raise questions about the impact of the RFS on emissions. 

The third goal of the RFS is to boost rural economies, and here we can say that 

the program has delivered on its promise. The RFS has strengthened the demand 

for and price of corn, soybeans, and other feedstocks. And the bio-refineries that 

turn these materials into renewable fuels are primarily located in small farming 

communities where they provide a substantial number of jobs. I might add that 

many in the animal agriculture sector believe that the RFS raises the price of feed, 

so the benefits are far from universal, but overall the program remains popular in 

rural Kentucky and most of rural America. 

I believe we should have an open mind on whether changes are needed. Perhaps 

we can improve upon the benefits of this program while minimizing the downside. 

I am particularly concerned about the impact of the RFS on consumers. Billions 

of gallons of ethanol are being added to the fuel supply and we need to be certain 

that these renewable fuel-containing blends work well for the owners of the millions 

of cars, trucks, motorcycles, boats, and small engine equipment who use them. That 

is why I am particularly pleased that we are being joined by Mr. Todd Teske, the 

CEO of Briggs & Stratton, who can expand on the impacts of the RFS on outdoor 

power equipment. 

In addition, I am concerned about the program’s long-term future, especially given 

that after the year 2022, the EPA will have a great deal of latitude in redesigning 

the program as the agency wishes. For these and other reasons, I welcome this important and necessary discussion of the RFS. 

Mr. WHITFIELD. At this time, I would like to yield the balance 

of my time to the gentleman from Illinois, Mr. Shimkus. 

Mr. SHIMKUS. Thank you, Mr. Chairman. First, I want to apologize. As Assistant Administrator McCabe knows, I am probably 

headed down to the White House for a bill signing so I am going 

to miss some of the—well-timed maybe, but I am going to miss 

some of the testimony and the questions. 

3 

But just to weave the story, it was in 1992 where the auction and 

debate came into the fuel market, Clean Air Act of ’92. I am reminded when I see my friend Kenny Hulshof in the background it 

was in 1998 when I really passed my first bill that changed EPAC 

on biodiesel to get real credits for fleets for fuel use, and that was 

just Karen McCarthy from Kansas City, Missouri, have a long part 

in this debate. In 2005, under the leadership of Chairman Barton 

we changed the debate again. We changed it from the clean air portions to energy security and that is what brought 2005 into the 

market. Then under the leadership of Chairman Waxman under 

Democrat controls we expanded the RFS and really started pushing 

next generation cellulosic issues. 

And we kind of find ourselves, this is kind of where we find ourselves now, but the world has changed also with fracking and so 

the energy independence issue is in front of us. You ask yourself 

why are we exporting and importing either ethanol, exporting or 

importing ethanol. You ask yourself why are we importing and exporting biodiesel when if we need it we ought to maybe just be selling it to ourselves instead of having to ship it overseas. All this will 

require, you know, changes in laws. 

And I would ask our panelists to not only give us their best case 

story but also to listen to each other, because as we move forward 

we are going to have to move towards compromise because a lot of 

people have raised capital, assumed risk, created jobs, great tax 

bases for our communities, and we will be better when we work together than when we work apart and I know we can do that. 

And with that Mr. Chairman, again I apologize for having to 

leave, probably well timed. I wish I could take credit for the President’s decision to have this now, but with that I yield back the balance of my time. 

Mr. WHITFIELD. The gentleman yields back. 

And before I introduce Mr. Rush, I do want to recognize Mr. Tom 

Bliley, former chairman of the Energy and Commerce Committee, 

the distinguished gentleman from Richmond. And when I first 

came to Congress in 1995 he was our chairman and did a fantastic 

job. And Tom, welcome back to the Energy and Commerce Committee. 

At this time I would like to recognize the gentleman from Illinois, Mr. Rush, for a 5-minute opening statement. 

OPENING STATEMENT OF HON. BOBBY L. RUSH, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS 

Mr. RUSH. I want to thank you, Mr. Chairman. Mr. Chairman, 

this is a very important hearing on the implementation of the Renewable Fuel Standard. As you can imagine, Mr. Chairman, my office has taken dozens of meetings on this important topic for both 

proponents who support the RFS as it is as well as from the opponents who would like to see the RFS either modified or repealed 

altogether. 

From its inception I strongly supported this policy and the goals 

that it was first enacted to do. Some of the objectives include helping to reduce U.S. dependence on foreign oil, enhancing energy security, bolstering the agricultural sector, and addressing the challenges of climate change by reducing greenhouse gas emissions 

4 

from the transportation sector, Mr. Chairman, are some of the 

things that I have strongly supported. 

Since that time, Mr. Chairman, the energy landscape has 

changed significantly in our nation, and at meeting after meeting 

in my office we have received a host of competing and in many 

cases contrasting information on the impact of the RFS. 

Today I am most interested, Mr. Chairman, in hearing about the 

impact of the RFS on food and agricultural prices as well as the 

issues surrounding the gasoline ethanol blend wall. Additionally, 

Mr. Chairman, with more frequent record-breaking temperatures 

and history making extreme weather events, it is imperative that 

we also examine the impact of the RFS in regards to climate 

change for those who are concerned about this very, very critical 

issue. 

It is my hope that today we will be able to shed light on the current status of the program and find more clarity on the effectiveness it has had in meeting its original goals. I am pleased with the 

diversity of the panelists and the different industry sectors that 

they represent, as I believe this will lead to a more robust and comprehensive debate. 

Hopefully, Mr. Chairman, today’s discussion will provide clarity 

and a better understanding of this issue for members on both sides 

of the aisle. I think it is important to hear from the various stakeholders on some of these important issues surrounding the RFS in 

a public and transparent setting, where they will have the opportunity to respond and rebut other witnesses so that members may 

gain a better idea of what indeed is fact and what is fiction in regards to this debate. 

So Mr. Chairman, it goes without saying that I look forward to 

learning more about most of the opportunities and the challenges 

to implementing the RFS as currently drafted, and it is my hope 

that we can work to find an excellent common ground on this issue 

moving forward. With that Mr. Chairman, I yield back. 

Mr. WHITFIELD. The gentleman yields—— 

Mr. RUSH. No, I yield a minute to Mr. Welch. 

Mr. WHITFIELD. The gentleman yields to Mr.—OK. 

Mr. WELCH. Thank you, Bobby. I thank the gentleman. Thank 

you, Mr. Chairman, for this hearing. 

The RFS mandate has been a well-intended flop. It has not 

helped the environment, it has hurt it. It has not reduced fuel— 

it has increased food costs in this country and in foreign countries, 

and it has done an immense amount of engine damage to everyday 

folks who want to use chainsaws; want to use boats, boat motors; 

want to use motorcycles. 

And I have here a photograph from the Burlington Free Press 

which shows a carburetor that was clean, it used regular gas, and 

this was one that was brought in that has been damaged by ethanol. And I have a carburetor here. It will be a little tougher to 

see, but this is from a Suzuki motorcycle owned by a veteran. And 

one side is what would be the condition of the carburetor with regular gas. This is the dirty, filthy side that is the carburetor from 

the use of ethanol, and the veteran who owned that motorcycle had 

to pay a bill of $786 just to fix that up from the damage done by 

ethanol. 

5 

So we have got this situation here where in addition to the food 

costs, in addition to the environmental damage, everyday folks who 

are out there riding their motorcycles, veterans, everybody using a 

small engine, using their chainsaw are finding that when they 

leave it there suddenly it is wrecked. And in fact my chainsaw got 

wrecked as a result of ethanol, so I have got a chainsaw grievance 

along with a lot of my constituents. 

This was a plan that had bipartisan support, RFS. It had the 

best of intentions, it had the worst of outcomes. It is time for us 

to change it, and I am delighted to be working with Mr. Flores of 

Texas in a strange partnership of the Lone Star State and the 

Green Mountain State. Thank you very much. I yield back. 

Mr. WHITFIELD. The gentleman yields back and the gentleman’s 

time has expired. Mr. Upton is not going to take the time for an 

opening statement. Is there anyone on our side of the aisle that 

would like to claim time for an opening statement? Mr. Barton. Mr. 

Barton is recognized for 5 minutes. 

Mr. BARTON. Oh, I am not going to use 5 minutes, Mr. Chairman. I do want to thank the chairman and Mr. Rush for holding 

this hearing, and I want to thank Mr. Welch and Mr. Flores for introducing their bill. 

I was chairman of the full committee when we put the original 

Renewable Fuel Standard in place in the Energy Policy Act of 

2005. I supported it then. I was ranking member when they passed 

the 2007 Energy Bill that greatly expanded it, and I have vehemently opposed the expansion in committee and on the floor. And 

so I have been for it and I have been against it. 

I today think, Mr. Chairman, that you could actually repeal it 

and market conditions would still provide a robust market for ethanol and all other alternative fuels. There is no question that the 

oxygenate ability of ethanol is a positive. There is also no question 

that this is not a struggling industry that needs the various protections and mandates that we have put into the law, and there is 

also no question that you can’t meet the requirement, the market 

cannot meet the requirement that the current law requires. 

So I think this is an excellent hearing. I am going to listen with 

an open mind. Again I want to thank the chairman and the ranking member and our two bipartisan cosponsors for this legislation. 

I am not sure we can legislate this year, but I think it is something 

that needs to be looked at in the near future. 

And I will be happy to yield to Mr. Flores. It looks like he wants 

some time. I yield the balance of my time to Mr. Flores. 

Mr. FLORES. I thank Mr. Barton for his comments and for yielding the time. I also thank Mr. Welch for working with me to introduce a common sense, market-driven, bipartisan solution to deal 

with the well-intended law that just hasn’t worked out the way it 

should. 

I also want to thank the chairman for holding today’s hearing. 

It has been almost 9 years since the RFS was expanded under the 

Energy Independence and Security Act of 2007, and I am very 

pleased that we are revisiting the important role of this committee 

and the Congress to exercise oversight through today’s hearing. 

One of the biggest concerns that will be discussed today is that 

the 2007 era assumptions of increasing gasoline demand turned out 

6 

to be far too optimistic. And the volumes that were set forth in the 

statute do not come close to recognizing today’s market reality with 

respect to gasoline demand. Consumers are now faced with a law, 

actually they are adversely impacted with the law that continues 

to increase a mandate in ethanol at a time when they are using 

less gasoline. 

Last month, Mr. Welch and I introduced the Food and Fuel Consumer Protection Act and again this is a market-driven, common 

sense, bipartisan solution. It is a simple one. It prevents the RFS 

mandate from forcing more ethanol into the market than is technically and commercially feasible. And with that I yield back the 

balance of my time. Thank you. 

Mr. WHITFIELD. The gentleman yields back. At this time the 

chair recognizes the gentleman from New Jersey, Mr. Pallone, for 

5 minutes. 

OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE IN CONGRESS FROM THE STATE OF NEW JERSEY 

Mr. PALLONE. Thank you, Chairman Whitfield and Ranking 

Member Rush for this opportunity to hear from the Administration 

and many of the key stakeholders on the Renewable Fuel Standard 

program. 

The transportation sector is our country’s largest consumer of oil 

and the second largest emitter of carbon pollution, so the development of low carbon renewable fuels is certainly critical. The RFS 

program that Congress established in 2005 and amended significantly in 2007 has helped extend our domestic fuel supply and it 

has spurred investment in alternative fuel production. The RFS 

has also supported farm incomes and rural economy in a number 

of states. 

In recent years, domestic production of fuel overall increased due 

to expanded domestic production of oil and gas, and the production 

of ethanol has also provided us with a stable supply of domestic 

fuel. And the availability of ethanol provided an alternative to 

MTBE as an octane enhancer and oxygenate when MTBE proved 

to be a problem in water systems across the country. 

Despite these successes, there have also been a number of challenges. For example, the annual obligation for the EPA to set RFS 

targets has been more controversial and challenging than Congress 

originally anticipated. Moreover, the increase in renewable fuel 

production targets Congress passed in 2007 anticipated faster and 

broader based development of cellulosic ethanol and other advanced biofuels. 

There are also a number of constituencies, particularly equipment manufacturers and their customers including small boaters, 

who still have concerns about increasing the percentage of ethanol 

beyond the ten percent fraction that is commonly sold throughout 

the country. And there are others who question whether increasing 

biofuel production will achieve the program’s important environmental goals, particularly the goal of reducing greenhouse gas 

emissions from the transportation sector. 

I want to thank Assistant Administrator McCabe for coming 

today to discuss the EPA’s implementation of the RFS. This is a 

7 

challenging assignment. Every year, EPA must balance many different factors with the needs and desires of many assorted players 

throughout the fuel supply chain from production to distribution to 

use. And to some degree, this has been made more difficult by the 

fact that the targets we set in 2007 assumed that the demand for 

transportation fuels would continue to grow. However, we have actually seen reduced demand nationally for transportation fuel due 

to a combination of historically higher fuel prices, increased vehicle 

fuel efficiency, slower growth in vehicle miles traveled, and of 

course the recession. 

So I look forward to hearing more about the implications for the 

fuel market from Mr. Gruenspecht from the Energy Information 

Agency, as well as from witnesses on our second panel. During today’s hearing we should consider how the RFS contributes to the 

deployment of the low carbon transportation system of the future 

that benefits both our environment and our economy, but we 

should also consider how this program could work better to help us 

meet our climate goals. Fortunately, we have an excellent panel of 

witnesses here today who can speak to these matters, so I look forward to hearing their perspectives on the RFS program. 

[The prepared statement of Mr. Pallone follows:] 

PREPARED STATEMENT OF HON. FRANK PALLONE, JR. 

Thank you Chairman Whitfield and Ranking Member Rush for providing us an 

opportunity to hear from the Administration and many of the key stakeholders in 

the Renewable Fuel Standard (RFS) program. 

The transportation sector is our country’s largest consumer of oil and the second 

largest emitter of carbon pollution, so the development of low carbon renewable 

fuels is critically important. The RFS program that Congress established in 2005 

and amended significantly in 2007 has helped extend our domestic fuel supply, and 

it spurred investment in alternative fuel production. The RFS has also supported 

farm incomes and rural economies in a number of states. 

In recent years, domestic production of fuel overall increased due to expanded domestic production of oil and gas. The production of ethanol has also provided us 

with a stable supply of domestic fuel. And, the availability of ethanol provided an 

alternative to MTBE (M–T-B–E) as an octane enhancer and oxygenate when MTBE 

proved to be a problem in water systems across the country. 

Despite these successes, there have also been a number of challenges. For example, the annual obligation for the Environmental Protection Agency (EPA) to set 

RFS targets has been more controversial and challenging than Congress originally 

anticipated. Moreover, the increase in renewable fuel production targets Congress 

passed in 2007 anticipated faster and broader-based development of cellulosic ethanol and other advanced biofuels. 

There are also a number of constituencies—particularly equipment manufacturers 

and their customers, including small boaters—who still have concerns about increasing the percentage of ethanol beyond the 10 percent fraction that is commonly sold 

throughout the country. And there are others who question whether increasing 

biofuel production will achieve the program’s important environmental goals, particularly the goal of reducing greenhouse gas emissions from the transportation sector. 

I want to thank Assistant Administrator McCabe for coming today to discuss the 

EPA’s implementation of the RFS. This is a challenging assignment. Every year, 

EPA must balance many different factors with the needs and desires of the many 

assorted players throughout the fuel supply chain—from production to distribution 

to use. 

And to some degree, this has been made more difficult by the fact that the targets 

we set in 2007 assumed that the demand for transportation fuels would continue 

to grow. However, we’ve actually seen reduced demand nationally for transportation 

fuel due to a combination of historically higher fuel prices, increased vehicle fuel efficiency, slower growth in vehicle miles traveled, and the recession. 

8 

I look forward to hearing more about the implications for the fuel market from 

Mr. Gruenspecht from the Energy Information Agency, as well as from witnesses 

on our second panel. 

During today’s hearing we should consider how the RFS contributes to the deployment of the low-carbon transportation system of the future that benefits both our 

environment and our economy. But, we should also consider how this program could 

work better to help us meet our climate goals. Fortunately, we have an excellent 

panel of witnesses here today who can speak to those matters. I look forward to 

hearing their perspectives on the RFS program. 

Mr. PALLONE. I yield the remainder of my time to Representative 

Loebsack. 

Mr. LOEBSACK. Thank you, Mr. Pallone, and thank you, Mr. 

Chair, for having this hearing. It is very important. I only came to 

Congress in 2007 so I was able to vote on at least the 2007 bill. 

Assistant Administrator McCabe, Deputy Gruenspecht, thank you 

for taking the time to come here today to discuss the RFS. 

And harnessing the power of our renewable resources is an absolutely critical part of our energy portfolio here in America. I think 

we can all agree on that. The RFS, I believe, has proven that it 

works. It has created jobs, it has supported our agricultural communities, and it has decreased our dependence on foreign oil. 

The RFS has helped bring competition, something that was intended, and consumer choice, another thing that was intended, to 

the retail transportation fuel marketplace while reducing at least 

to some degree our dependence on foreign oil imports. In addition, 

the industry supports over 400,000 U.S. jobs that can’t be 

outsourced and has contributed some $45 billion to the U.S. economy, while in fact reducing the emissions of greenhouse gases. 

As you also all know my state is a leader in biofuels, and before 

we get too carried away with ethanol, that also includes biodiesel, 

by the way. That is very important as far as the RFS is concerned 

and it has positively impacted of course our domestic energy 

sources. To help advance greater choice at the pump I have also 

introduced legislation to establish a grant program through the 

USDA to invest in renewable and alternative fuel infrastructure. 

My bill, the Renewable Fuel Utilization, Expansion, and Leadership Act, or REFUEL, will create a new and retrofit existing infrastructure including pumps for biofuels and hydrogen tanks, piping, 

and electric vehicle chargers so that we have not just ethanol and 

biodiesel. 

Too often, infrastructure constraints are cited as the reason for 

not giving consumers the choices they deserve and this is about 

choices—keep that in mind—and for holding back the development 

of our renewable and alternative energy sources that create jobs in 

Iowa and across the country. The REFUEL Act will help bridge 

that divide by making important investments in the infrastructure 

needed to provide consumers with the choices that they want at the 

pump. 

We must do more to decrease our dependence on foreign oil and 

expand our use of renewable energy sources that boost economic 

development in our rural areas and at the same time promote 

homegrown fuel sources such as biofuels and wind power. Administrator McCarthy stated in February of 2016, ‘‘We need to get the 

program RFS back on track. Every gallon of ethanol you take out 

you can only replace with more fossil fuels, so we must continue 

9 

to fight to ensure that our rural communities are part of to put our 

nation back on a sustainable path so that those rural communities 

can do that and create good jobs in our rural areas.’’ 

And I don’t have any visual aids with me, but one of them I 

could think of might be a corncob although not necessarily that. 

Also I think if we had a soldier or a Marine here who has gone to 

fight in the Middle East, I think that would be important because 

this is also about making sure that we reduce our dependence on 

foreign oil, and I think we lose sight of that sometimes when we 

talk about the RFS. It is about choices. Yes, it is about jobs, but 

it is also creating a situation where we are not so dependent on 

other countries for oil. 

So thank you for yielding, Mr. Pallone. And thank you, Mr. 

Chair, for having this hearing today and look forward to the testimony. Thank you. 

Mr. WHITFIELD. The gentleman yields back. And that concludes 

the opening statements, so we are now ready for our first panel of 

witnesses and I am delighted that both of you joined us this morning. Our first witness is Ms. Janet McCabe who is the acting assistant administrator at the U.S. Environmental Protection Agency. 

Ms. McCabe, thanks for being with us. You are recognized for 5 

minutes for your opening statement. Just make sure the microphone is on and you know the drill. 

Ms. MCCABE. I know the drill. 

Mr. WHITFIELD. Thank you. 

Ms. MCCABE. Been here before. 

STATEMENT OF JANET MCCABE, ACTING ADMINISTRATOR, 

U.S. ENVIRONMENTAL PROTECTION AGENCY; AND HOWARD 

GRUENSPECHT, DEPUTY ADMINISTRATOR, U.S. ENERGY INFORMATION ADMINISTRATION 

STATEMENT OF JANET MCCABE 

Ms. MCCABE. Thank you, Chairman Whitfield, Ranking Member 

Rush, and other members of the subcommittee. I very much appreciate the opportunity to testify on the RFS program today and 

EPA’s current proposed rule setting the annual volume standards 

for 2017 and biomass-based diesel volume requirement for 2018. 

As has been noted, the RFS program began in 2006 under the 

Energy Policy Act of 2005, and the program was then modified by 

the Energy Independence and Security Act of 2007. The goals of 

that law include moving the United States towards greater energy 

independence and security and increasing production of clean, renewable fuels. The law established new annual volume targets for 

renewable fuel that increase every year to reach a total of 36 billion gallons by 2022, including 21 billion gallons of advanced 

biofuels. 

Congress included tools known as waiver provisions for EPA to 

use to adjust the statutory targets in specified circumstances, including where the statutorily prescribed volumes could not be met. 

After an extensive notice and comment process including working 

closely with our federal partners at the USDA and the DOE, EPA 

finalized regulations to implement those requirements and those 

became effective in July of 2010. 

10 

The Clean Air Act requires EPA to issue annual standards for 

four different categories of renewable fuels: total, advanced, biomass-based diesel, and cellulosic. These standards designate the 

percentage of each biofuel category that producers and importers of 

gasoline and diesel must blend into transportation fuel, heating oil 

or jet fuel, and those must be issued by November 30th of each 

year for the following year, and 14 months in advance for the biomass-based diesel category. 

On November 30th, 2015, we finalized standards for 2014 

through 2016, and a biomass-based diesel volume for 2017. In that 

final rule, we used the waiver authorities provided by Congress to 

lower the volume requirements for total, advanced, and cellulosic 

below the statutory targets, but only to the extent necessary and 

appropriate in light of supply limitations and to levels that will 

drive ambitious, achievable growth. 

On May 16th of this year, we issued a proposed rule to establish 

the annual percentage standards for cellulosic, advanced, and total 

renewable fuel that will apply in 2017, and also the volume requirement for biomass-based diesel for 2018. In this proposal, we 

are proposing to take the same approach to setting standards and 

volume requirements as in last year’s rule. 

This Administration is committed to supporting continued 

growth and renewable fuels, especially advanced biofuels, through 

this proposed rulemaking. We are proposing volumes that once 

again would require significant growth in renewable fuel production and use over historical levels directionally consistent with congressional intent. The proposed volumes represent increases across 

the board, and while they are not as high as the statutory volumes 

they are intended to drive increased production and use of renewable fuel. 

As proposed, total renewable fuel volumes would grow by nearly 

700 million gallons between 2016 and 2017. Advanced renewable 

fuel which requires a minimum 50 percent lifecycle greenhouse gas 

emissions reduction would grow by nearly 400 million gallons. The 

conventional or non-advanced portion of the renewable fuels would 

increase by 300 million gallons which is 99 percent of the congressional target of 15 billion gallons. 

Biodiesel which must also achieve at least 50 percent lifecycle 

emission reductions would grow by 100 million gallons between 

2017 and 2018, which is more than double the congressionally 

mandated minimum level of one billion gallons. And cellulosic 

biofuel which is the most advanced, requires 60 percent lifecycle reductions, would grow by 82 million gallons which is 35 percent increase between 2016 and 2017. We believe that these proposed volumes are achievable and consistent with Congress’ clear intent to 

drive renewable fuel use even as we propose to use the waiver authorities that Congress also provided so that we can manage the 

program responsibly. 

We had a public hearing in Kansas City, Missouri, on June 9th. 

There were more than 125 people who spoke there representing a 

broad range of interests. The public comment period for our proposed rule will remain open through July 11th, 2016, and we look 

forward to reviewing everybody’s comments and continuing to engage with the stakeholders as we do as we work towards a final 

11 

rule. We also look forward to any additional information and data 

that will come our way that will inform our final standards. We are 

committed to issuing those standards on the statutory time frame 

which would be by November 30th of this year. 

We continue to encourage and support production and blending 

of renewable fuels to maximize reductions in greenhouse gases. 

This has and will continue to be a high priority for my office and 

the EPA. We are continually monitoring developments in the industry as a result of both the RFS program and other programs 

run by USDA and DOE that support biofuels and biofuel infrastructure such as USDA’s Biofuel Infrastructure Partnership program. And we will continue to work closely with our federal partners as we implement this statute. 

Again I thank you for an opportunity to be here this morning, 

and I look forward to your questions and to the discussion. 

[The prepared statement of Janet McCabe follows:] 

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Mr. WHITFIELD. Thank you, Ms. McCabe. And our next witness 

is Mr. Howard Gruenspecht who is the deputy administrator of the 

U.S. Energy Information Administration. Mr. Gruenspecht, you are 

recognized for 5 minutes for an opening statement. 

STATEMENT OF HOWARD GRUENSPECHT 

Mr. GRUENSPECHT. Chairman Whitfield, Ranking Member Rush, 

members of the committee, I appreciate the opportunity to appear 

before you today. The Energy Information Administration is a statistical and analytical agency within the Department of Energy. By 

law our data analyses and projections are independent, so my 

views should not be construed as representing those of the Department or any other federal agency. 

My testimony has eight main points. First, the RFS program is 

not expected to come close to the legislated target of 36 billion gallons of renewable motor fuels use by 2022. All of EIA’s referenced 

case projections since enactment of the present RFS targets in 2007 

reflect a shortfall that continues to grow through 2022. Virtually 

all of the shortfall involves cellulosic biofuels. 

Second, substantial increase in biofuels use would require moving beyond the low percentage blends that account for nearly all 

current biofuels consumption. Third, the hope that large volumes 

of liquid cellulosic biofuels would be available within the decade 

following adoption of the 2007 RFS targets has not been realized. 

The actual supply of liquid cellulosic fuels was less than one-tenth 

of one percent of the legislated RFS target for cellulosic biofuels in 

2015. 

In mid-2014, EPA began issuing cellulosic RFS credits for compressed natural gas and liquid natural gas derived from landfills 

and other biogas recovery facilities that exist independently of the 

RFS program. Cellulosic biogas, which unlike liquid cellulosic fuels 

does not displace petroleum use, provided more than 97 percent of 

total cellulosic biofuels credits in 2015. 

A fourth point, ethanol faces demand, distribution system, and 

regulatory challenges that pose barriers to increasing its use as a 

motor fuel. As some of the members have indicated, ethanol has 

three distinct roles in motor fuels markets: providing octane, adding to fuel volume, and providing energy content. Ethanol has 

achieved great success in the first two roles where it is supported 

by factors independent of the RFS. While these two uses also provide some energy content, additional use of ethanol as an energy 

content source faces significantly higher economic hurdles, as 

shown in Figure 1 of my written testimony, and therefore depends 

more directly on the RFS. 

Fifth, while gasoline demand has been very robust over the last 

18 months, longer term EIA projections shown in Figure 2 show a 

declining trend in motor gasoline use, significant change from projections made prior to 2010. Even these updated projections do not 

reflect the recently proposed fuel economy standards for heavy-duty 

trucks because our projections are based on current laws and regulations, and those proposed regulations if finalized would significantly reduce projected diesel fuel use. 

Reductions in the long term projections for gasoline use mainly 

reflect higher fuel economy standards actually also enacted in 2007 

16 

at the same time the RFS targets were changed, slower economic 

growth, possible changes in consumer behavior, and until recently 

higher gasoline prices. So we think that some of these adjustments 

in gasoline demand have likely affected the timing of some current 

RFS compliance challenges, but unlike the other factors addressed 

in my testimony it is not a major cause of the persistent past and 

projected shortfalls in biofuels use relative to the legislative targets. 

Sixth, and I think this has also been mentioned in the opening 

statements, actual and projected reliance on oil imports is significantly lower than it was when the expanded RFS program was enacted in 2007. Figure 3 of my testimony shows that reflecting the 

combined effects of more robust domestic petroleum production and 

lower petroleum demand. Biofuels volumes added in response to 

the RFS program have played only a smaller part in reducing net 

import dependence taking account of the fact that ethanol would 

continue to be used as an octane and volume source independent 

of the RFS, and I think that was also made a comment by one of 

the opening statements. 

Seventh, the near and long term costs of the RFS depend on the 

price of oil, the price of agricultural commodities used to produce 

biofuels, future implementation decisions, and all else equal lower 

oil prices tend to raise the cost of RFS compliance. 

And then I just want to close by pointing out that EIA remains 

actively engaged in matters related to the RFS—of course we don’t 

get involved in policy matters—including data on biodiesel and ethanol production and ethanol blending. We provide EPA with short 

term forecasts for motor fuels use and cellulosic biofuels production 

as required by statute and also develop longer term projections. 

Thank you again for the opportunity to testify. 

[The prepared statement of Howard Gruenspecht follows:] 

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Mr. WHITFIELD. Well, thank you, Mr. Gruenspecht, and thank 

both of you for your testimony. At this time I would like to recognize the gentleman from Texas, Mr. Olson, for 5 minutes of questions. 

Mr. OLSON. I thank the chair. 

Mr. WHITFIELD. Sorry, Mr. Barton. 

Mr. BARTON. If Mr. Olson is fired up, I will let him go first. I 

am going to be here a while. 

Mr. OLSON. The chairman knows we Texans are always fired up. 

Mr. BARTON. I will yield to Mr. Olson, and then I will go on the 

next Republican, because he is ready. 

Mr. WHITFIELD. All right, Mr. Olson. 

Mr. OLSON. I thank both the gentlemen. Welcome, Mr. 

Gruenspecht, and a special welcome to Ms. McCabe. Every time we 

ask you to show up, you show up, and I appreciate that. 

Together we have seen huge changes in the American energy sector. Together we have changed outdated policies to reflect our current situation. Together we ended the ban on American crude oil 

exports, a 40-year law that we ended together. Together we started 

shipping American liquefied natural gas overseas striking blows to 

Russia, OPEC, and ISIS. Together we have said out with the old, 

in with the new. Our RFS policy is old and I hope together we can 

make it new. 

Here is an idea for you to consider, Ms. McCabe. As you know 

the obligation to comply with the RFS is currently on the refiner. 

Not all refiners, but some independent refiners. They get hit hard 

by this fact. These refiners don’t control the ethanol. They generally don’t even see it, but yet they are on the hook for the mandate. 

What are your thoughts, ma’am, about changing the point of obligation or other like issues important to major refiners? 

Ms. MCCABE. Well, thank you for that question, Congressman, 

and I indeed am always happy to come here and speak with you 

about these interesting issues and important issues. The point of 

obligation issue which you raise is one that is very much on our 

minds right at the moment and it has been for some months because there is a great deal of interest in it from a variety of perspectives. 

When the original RFS rule was done in 2010, this was our discussion, where would the obligation land. And there was a robust 

and public process, and the final rule with the support of many in 

the industry was that the right place to put it was on the refiners. 

And in recent years we have been hearing people question that and 

say wouldn’t it be better to put it somewhere else. 

We now actually have several petitions pending in front of us to 

ask us to undertake a rulemaking to look at that issue. So we are 

looking at that. We are talking to people across the board. Not everybody is of that view as you might expect. So we need to be collecting that information, talking to people. We will respond to the 

petitions. I don’t have a time frame to give you this morning, but 

we are looking at them very closely and know this is an important 

issue to look at. 

Mr. OLSON. Thank you, good news. 

28 

Mr. Gruenspecht, a question for you, my friend. EPA’s final rule 

for the RFS has yet another increase in the renewable fuel mandates. To up this work and avoid hitting the blend wall, EPA assumes that the use of higher blends of ethanol will increase and 

that demand for E0, fuel without any corn ethanol, will remain 

low. 

EPA’s estimated projections that demand for E0 will only be 200 

million gallons going forward per year, yet boat owners and 

chainsaw owners and small engine owners still buy plenty of E0 to 

avoid damaging their engines. In fact, in a ‘‘Today in Energy’’ piece 

EIA put out this May, you all said that Americans used 5.3 billion 

gallons of E0 in 2015. E0 is really hard to find, yet somehow motivated Americans have found a way to buy over five billion gallons 

of it. 

EPA projects that E0 use will be, again 20 million gallons in the 

future. You guys are about five billion gallons apart going forward. 

As they say in Texas, that is a big E0 enchilada to swallow. My 

question is, how likely is it that E15 use will explode to by five billion gallons or that if that is not going to happen, how likely is it 

that E0 will sink by 96 percent and get down to 200 million gallons 

per year? 

Your thoughts with that, sir? 

Mr. GRUENSPECHT. I guess so. So yes, EIA does data work and 

analysis work. And what we have put out in our data is data. We 

know how much E0 is produced. We know how much is exported. 

You know, there is some, a little bit of ethanol that we can’t account for and so we kind of assume that that was used to blend 

some of the E0 down and then we came up with that number. 

That is not a statement about what should happen or might happen. You know that is a statement looking back with the data we 

have available as what has been happening. I don’t think that necessarily there are differences—well, EPA should obviously speak 

for itself. But our statement is not about what should happen or 

how much E0 is needed for certain uses, it is just a statement that 

we know, we think we know how much of this is being absorbed 

by domestic consumers. Now people want something—— 

Mr. OLSON. Ms. McCabe, do you coordinate at all with the EIA? 

Do you coordinate with them and get their input? Because he said 

it is five billion gallons per year. You guys are down to 200 million. 

I mean, five billion, 200, it is way off. So do you listen to them at 

all? 

Ms. MCCABE. No, we certainly coordinate with them very closely. 

This is a very recent report and as soon as it came out our staff 

was on the phone with Howard’s staff very quickly to make sure 

that we understand what is behind those numbers. Every time we 

go to a proposal we have got a set of information in front of us. 

We do our best to project into the future, which is what our job is 

about. And then between proposal and final not only do we get information from the stakeholders but we get further updates from 

the EIA, and those are absolutely informative to us as we finalize 

our rule. 

Mr. OLSON. But you shouldn’t be surprised. You should work together. I yield back. 

29 

Mr. GRUENSPECHT. And I would also say that in that article 

again just factually that over the last 3 years the calculated use 

of E0 to final consumers, has been dropping. So again, but you correctly cite what was in the article. 

Mr. WHITFIELD. The gentleman’s time has expired. At this time 

the chair recognizes the gentleman from Illinois, Mr. Rush, for 5 

minutes. 

Mr. RUSH. Thank you, Mr. Chairman. Administrator McCabe, 

the issue of RFS seems to have morphed into an all or nothing scenario where there is no room for common ground or compromise. 

Almost immediately after the EPA finalized the RFS volumes for 

2017, your agency was attacked from both sides of the debate. Supporters believed the volumes were too low while opponents thought 

they were too high, and both sides are bringing lawsuits against 

the agency. 

How do you respond to these charges and did the agency really 

foresee being sued by both sides? 

Ms. MCCABE. We were not surprised to be sued by both sides, 

Congressman. And there are some important issues here and I 

think once the courts speak to those issues there will be more clarity going forward. 

Our job is to try to implement the statute, and as you say we 

haven’t pleased everybody entirely. This statute is, and this program is about choice, it is about diversity, it is about providing incentives and opportunity for cleaner fuels to compete in the marketplace, so you are going to have people from different vantage 

points having very strong views about it. 

But we think that we are doing what we are supposed to do, 

which is to look at the information, to talk to everybody, to understand the industry as well as we can, and to do our very best to 

implement what we understand the intent of Congress to be, which 

is to have more renewable fuels in our transportation supply. 

Mr. RUSH. On the issues that surround the RFS, the issues that 

have been discussed today, and there are some issues that we 

haven’t talked about today, but is it your opinion that the EPA has 

the tools and the authority to deal with the challenges as they 

arise or is there some more that the Congress should be doing? 

Ms. MCCABE. Well, I believe that Congress gave us the tools in 

the statute that we need in order to implement it. And as has been 

recognized today, the world changes and certainly over the last decade the world has changed considerably. The world will change. We 

will come back here in 2 years and it will be different again, and 

5 years and 10 years. 

And Congress had a long vision for this program, and I think 

that is one of the challenges that people are seeing is that it takes 

a while to introduce this kind of change into a market system. But 

Congress gave us clear goals, they gave us clear criteria that we 

are supposed to consider, and they gave us the waiver authority to 

use in situations where in our judgment regulating the statutory 

volumes was just not feasible. So we are comfortable moving forward with the tools that Congress has given us. 

Mr. RUSH. I would like to switch lanes if I could. What is the 

EPA’s views on the so-called blend wall? Does the agency have conVerDate Nov 24 2008 12:31 Feb 23, 2017 Jkt 037690 PO 00000 Frm 00035 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 114\114-155 CHRIS
30 

cerns surrounding this issue, and if so how are these issues and 

these concerns being addressed by the agency? 

Ms. MCCABE. So the blend wall is a term that people use to refer 

to the amount of ethanol that is generally blended into E10. which 

is ten percent, and if you go above that amount it is referred to as 

exceeding the blend wall. In order to reach Congress’ statutory volumes there needs to be more ethanol in the system than can be absorbed just through E10 and we think that that is doable through 

blends like E15 and E85, and of course there are other types of renewable fuels that are being developed and can get into the system 

as well. 

So this is one of the key issues of debate. This proposal that we 

put out would call for ethanol above that ten percent ceiling, but 

we think in a responsible and a doable way that will help encourage the higher ethanol blends into the system. 

Mr. WHITFIELD. The gentleman yields back. This time the chair 

recognizes the gentleman from Texas, Mr. Barton, for 5 minutes. 

Mr. BARTON. Thank you. Thank you, Mr. Chairman. Mr. 

Gruenspecht—is that correct, Gruenspecht? Your Figure 2 that in 

your testimony—I want to make sure I understand this. In the estimate, the original estimate back in 2007, if I read it correctly 

your agency estimated that we would be using about ten million 

gallons of gasoline a day; is that correct? The little blue line on—— 

Mr. GRUENSPECHT. Yes, that is approximately ten million. 

Mr. BARTON. And diesel was about four million a day; is that 

right? 

Mr. GRUENSPECHT. Yes. 

Mr. BARTON. OK. How many gallons of gasoline are we using a 

day right now? 

Mr. GRUENSPECHT. I believe that this year we actually expect 

gasoline demand to be about 9.3 million barrels a day. 

Mr. BARTON. Nine, so a million less. 

Mr. GRUENSPECHT. Yes. 

Mr. BARTON. And what is it on diesel? 

Mr. WHITFIELD. Use your mic. 

Mr. GRUENSPECHT. I am sorry. Right, so this year, gasoline about 

9.3 million barrels a day. 

Mr. BARTON. And on diesel it is—— 

Mr. GRUENSPECHT. Diesel I am not quite sure. 

Mr. BARTON. But is it safe to say it is less than you estimated? 

Mr. GRUENSPECHT. I think it may be a little bit less. 

Mr. BARTON. OK. 

Mr. GRUENSPECHT. On the gasoline it has mostly to do, frankly, 

so the same legislation that enacted the RFS also enacted fuel 

economy standards, and this AEO 2007 line, again these reference 

cases use current laws and regulations. 

Mr. BARTON. Well, the point I am trying to make is the estimates 

that were used when we passed the expanded RFS in 2007 were 

gasoline volumes and diesel volumes going up, and in fact they are 

not. But the volume of ethanol that is required to be used is growing substantially. Is that not true? 

So we have created a situation, I mean, if you give the best of 

intentions to the Congress 9 years ago, those estimates that the 

volumes were based on haven’t happened. 

31 

Mr. GRUENSPECHT. I would agree with that. 

Mr. BARTON. Well, you have to because that is a fact. I mean—— 

Mr. GRUENSPECHT. Right. Well, on the other hand, I mean, so far 

be it from me to criticize Congress, but in the very same piece of 

legislation—— 

Mr. BARTON. You are the only person in America that doesn’t if 

you don’t, so—— 

Mr. GRUENSPECHT. Well, maybe I will cross over to the other side 

then and join the majority. Not the majority here. 

But actually, remember, in the same piece of legislation, you 

raised the fuel economy standards. So the notion of using that projection and saying that is what we thought, I realize that different 

groups probably were working on the RFS provision—— 

Mr. BARTON. Well, my point, it would be one thing if we had projections from 9 or 10 years ago that have happened so that all 

these volume increases could be absorbed because gasoline usage 

has increased, but that is not happening. 

Mr. GRUENSPECHT. Right. I would agree with that. 

Mr. BARTON. And it is not expected to happen. 

Mr. GRUENSPECHT. Right. And it is something, I agree, it is a factor, but the notion of 36 billion gallons of renewable fuels, you 

know that kind of—— 

Mr. BARTON. It is fantasy, and my word fantasy. That is fantasy. 

Mr. GRUENSPECHT. Well, I am not going to say that. 

Mr. BARTON. I know. You can’t say it but I can. So I am going 

to ask the EPA representative now. How long does EPA keep insisting that you can make the law work? At what point in time do 

you agree with the majority of this panel that as currently written 

it is simply not workable? 

Ms. MCCABE. Congressman, it is our job to implement the laws 

that you all have—— 

Mr. BARTON. I didn’t ask you what your job was. I am asking you 

for a policy statement. You are the highest ranking EPA official 

here. 

Ms. MCCABE. Yes. Well, it is really not up to me to speak to the 

legislation itself or any changes that Congress may be thinking 

about, although we are happy to work with you on it. 

Mr. BARTON. Let me ask you a different question. I am not going 

to let you stall me for the next 40 seconds. What would happen if 

we just repealed the RFS, just repealed it? 

Ms. MCCABE. Well, the—— 

Mr. BARTON. Would we still use ethanol? 

Ms. MCCABE. Oh, yes. 

Mr. BARTON. Wouldn’t we still use a lot of ethanol? 

Ms. MCCABE. There would be ethanol put into the gasoline, to 

E10 gasoline. There is a lot of investment already in higher blends 

of E10, or ethanol. I don’t think I am in a position to speak to what 

might happen to that if the law were repealed though. 

Mr. BARTON. But there would still—the ethanol market wouldn’t 

disappear if we repealed the RFS? 

Ms. MCCABE. I don’t expect that it would. 

Mr. BARTON. The market would require that we use ethanol. 

Ms. MCCABE. As Howard mentioned, there are a number of values that ethanol adds to the system. 

32 

Mr. BARTON. I agree. Unfortunately my time is expired, Mr. 

Chairman. 

Mr. WHITFIELD. The gentleman’s time has expired. At this time 

we will recognize the gentleman from Vermont, Mr. Welch, for 5 

minutes. 

Mr. WELCH. Thank you very much. I want to ask Administrator 

McCabe a few questions, and by the way Mr. Barton, it is our job 

to pass a law and yours to implement it. Thank you for understanding that. But it is your job to do the reports that Congress 

has asked for. And there was an EPA triennial report to Congress 

in 2011, and in that report it indicated that the most plausible land 

use changes and production practices from the ethanol mandate 

will likely be neutral or slightly negative. It also concluded that the 

majority of negative impacts of the RFS to date have been associated with corn ethanol. That report now is supposed to be done, updated, and it is really 5 years overdue and there has been no indication from EPA as to when Congress can expect to receive it. So 

my question is when does the EPA plan to send the next Triennial 

Report on the environmental impacts of RFS to Congress as required by law? 

Ms. MCCABE. Thank you, Congressman. We don’t like missing 

deadlines and we realize that there are deadlines in the statute 

that we have not made. I will tell you that our emphasis over the 

last several years has been on doing the annual volume standards 

which is what we felt the absolute priority in order to keep the program going. 

Mr. WELCH. So when do you think we might get that? 

Ms. MCCABE. I don’t have a date to give you. We are always 

looking at this information. We work with our Office of Research 

and Development on it. 

Mr. WELCH. All right, I will go on to the next question. It is helpful for us to have that because this data is really important in assessing whether the hopes and aspirations of the Congress about 

the original law are actually working or they are not. A second 

area of concern is the use of land. The USDA’s Farm Service Agency data shows that about 400,000 acres of previously uncultivated 

land was converted to cropland just between 2011 and 2012. And 

a University of Wisconsin-Madison study found that biofuel crops 

expanded onto seven million acres of new land between ’08 and 

2012, including millions of acres of native grasslands. How many 

acres of native grasslands and wetlands have been torn up or 

drained, respectively, since the RFS was passed in 2007, and does 

this land use change total more than a de minimis amount of acres 

that the EPA predicted in the 2010 RFS2 rule? 

Ms. MCCABE. I don’t have the exact numbers with me, Congressman, although we will be glad to provide them and follow up. But 

I will say that in each annual volume rule we look at the net use 

of land and whether in a net sense it has grown or gone down. 

Mr. WHITFIELD. Yes, and that is very much in dispute as a methodology because there is an immense loss of wildlife habitat where 

because of the incentives that Congress has passed, not just our 

RFS but we used to have the tax credit and we used to have the 

tariff barrier, it really promoted the over-cultivation of land. Then 

finally, there is a hope, there was a hope that the greenhouse gas 

33 

emissions would be reduced by using ethanol, and it has turned out 

that most of the evidence indicates that is not the case. The corn 

ethanol’s net emissions over 30 years are expected to be about 28 

percent higher than emissions that would result from the use of 

gasoline over that same period. And in 2011, the National Academy 

of Sciences’ study on RFS also questioned the greenhouse gas emission reduction potential of corn ethanol. Given that the majority of 

RFS gallons produced to date have been corn ethanol, what has the 

overall impact of the RFS been on the climate? 

Ms. MCCABE. Well, again we would be glad to follow up with 

more specifics, but I will say that the statute focuses on developing 

these advanced biofuels and moving those into a larger portion—— 

Mr. WHITFIELD. Right. This gets us back to Mr. Barton’s question. I mean, we have to answer it. We created the policy so we 

have to change it. But what is extremely helpful to us is to get 

real-time information about the climate impacts, the habitat impacts, the greenhouse gas emissions, so I thank you for your appearance here and I yield back the balance of my time. 

Mr. WHITFIELD. The gentleman yields back. At this time I recognize the gentleman from Ohio, Mr. Latta, for 5 minutes. 

Mr. LATTA. Well, thanks, Mr. Chairman, for the hearing today 

and for our first and second panel of witnesses for being with us 

today. We appreciate your testimony and the information you are 

giving us today. Administrator, if I could ask you the first question, 

on your second page of your testimony you speak of the waiver authority in setting recent standards and the proposed standard. 

Would you elaborate on the waiver authority and how EPA uses 

this authority on the waiver? 

Ms. MCCABE. Sure, I would be happy to. The statute provides 

two types of waiver authority: the cellulosic waiver and the general 

waiver. When we project the amount of cellulosic fuel that we think 

will be available in the year that we are setting the standard for, 

if it is below the statutorily prescribed amount then we are to 

lower it. And we have the ability to then lower the amounts of advanced and total fuel by the same amount. We are not required to, 

but we can. That is the cellulosic waiver authority. The general 

waiver authority, Congress provided that under two circumstances 

can we waive down or lower the statutory volumes on advanced 

and total, and one of those is when we find that there is an inadequate domestic supply. And so we have proposed in this rule, as 

we did in the rule we did last year, to use both of those waiver authorities to set expected standards that are lower than what the 

statute would require. 

Mr. WELCH. Thank you. 

Mr. Gruenspecht, in your testimony on your point 6, and I know 

we have had some discussion already about this, you discussed the 

calculations for net imports for overall U.S. petroleum consumption 

and EIA’s determination of what has led to the decline. Would you 

comment on this data and the conclusions again that you have 

come up with on that? 

Mr. WHITFIELD. Is your microphone on? 

Mr. GRUENSPECHT. I expected Ms. McCabe to get most of the 

questions, so—U.S. crude oil production has risen rather dramatically, as I am sure other hearings here have explored, from about 

34 

five million barrels a day to over nine million barrels a day and 

then have since fallen a bit with the lower oil prices. And that was 

clearly a major contributor. 

The other major contributor to reduced dependence, on net dependence on oil imports, were greater fuel economy, which many 

people, I think, would view as a very positive thing. There have 

been some economic problems in the country that people might not 

view as a very positive thing, but those certainly have also affected 

fuel consumption. And then I think the increased use of biofuels 

has also had some contribution. 

But the question is how much have biofuels increased because of 

the RFS? As much of the conversation has pointed out, there are 

a lot of biofuels that would be used with or without the RFS, a lot 

of ethanol. So in looking at how much biofuels have increased because of the RFS, if you would convert back those gallons into million barrels per day that is actually sort of a much smaller number 

than the increase in crude oil production, or I think the reduction 

in consumption due to greater fuel efficiency. I think that is what 

the testimony says. 

Mr. LATTA. Well, let me ask you. Also in your testimony, because 

you also mentioned point 5, you also discussed the projected decline 

in the motor gasoline use and you say that it is not a cause of past 

or projected shortfalls. Could you explain that? 

Mr. GRUENSPECHT. Sure. That really goes back to Mr. Barton’s—— 

Mr. LATTA. Mr. Barton’s question, right. 

Mr. GRUENSPECHT [continuing]. Question. So sure, remember 

that the program calls for getting to 36 billion gallons by 2022. And 

yes, clearly you could, if fuel consumption was somewhat higher as 

in those 2007 projections, you could put more ethanol into E10 with 

more gasoline consumption, but that would get you nowhere near 

the 36 billion gallons. So clearly the statute was not envisioning 

getting to 36 billion gallons based on E10 type blending into the 

gasoline pool. The statute was envisioning something completely 

beyond that in terms of transformation of the fuel system and that 

has very little to do with exactly whether we are consuming ten 

million barrels a day of gasoline or 9.3. And that is what I think 

that statement meant. 

Yes, it has had an effect. But no, it is not that everything would 

be great with this program in terms of meeting the legislative targets if those AEO 2007 demand projections for gasoline had been 

realized. 

Mr. LATTA. Thank you. Mr. Chairman, my time is expired and 

I yield back. 

Mr. WHITFIELD. The gentleman yields back. At this time I will 

recognize the gentleman from Iowa, Mr. Loebsack, for 5 minutes. 

Mr. LOEBSACK. Thank you, Mr. Chair. Thank you again for having this hearing. I think that while we debate, this whole RFS 

issue, it is really important that we get the facts on the table, and 

that is hopefully what we are doing today. No matter which side 

of the issue you are on, I just think that often in Congress we have 

anything but a fact-based discussion. So this is important for you 

folks to be here and I do appreciate both sides of the issue and the 

questions that are being asked. 

35 

It is clear, Madam Administrator, that you are asking farmers 

and our rural communities, I think, to shoulder the consequences 

of the so-called blend wall. I think it is also clear that there are 

other logical and common sense ways around the blend wall. 

If the concern of the blend wall is the price of RINs, for example, 

it seems economical to think that if oil companies were indeed concerned about RIN prices they would invest in more biofuel infrastructure to keep RIN prices down. 

Can you tell me what is being done by the EPA to look into the 

big oil companies’ control of the market and lack of choice for consumers and why these aren’t being addressed as part of the blend 

wall concern? 

Ms. MCCABE. Well, our process of setting the annual RVO requirement each year, is all about setting that expectation for the 

producers because they are the obligated parties. And the RIN 

mechanism and the RIN prices you have identified is a mechanism 

to create incentives for the refiners to actually make sure that 

there is more alternative fuel in the system. 

There are also programs such as the ones at USDA that help 

provide encouragement and funding to increase infrastructure and 

investment and those that will continue to make this more attractive in the market. And as you say, it is about consumers and 

about choice, and if people want the fuel it will be there for them. 

The RIN system provides that extra incentive and the requirement, 

the obligation, does as well. 

Mr. LOEBSACK. OK. I have a question about in the proposed rule 

where you state, and I quote, to date we have seen no compelling 

evidence that the nationwide average ethanol concentration in gasoline cannot exceed ten percent, unquote. 

So with that statement in mind, why do you feel the need to roll 

back this policy based on demand and the so-called blend wall 

when you readily admit that we as a nation can go beyond ten percent ethanol in the fuel supply? 

Ms. MCCABE. Well, we haven’t rolled back the requirement at all, 

and in fact our proposed rule would require ethanol above ten percent in the system. I think it is about 10.4 percent. And so that 

is exactly what we do in considering the waiver where the statutory volumes would go significantly beyond that ten percent. 

Our evaluation is that those are not realistic or feasible, our job 

then as we see it is to set a volume that is as close to that statutory volume as we think is appropriate. And this proposal will require more ethanol or more renewable fuel. It will be served by 

whatever fuel is competitive and makes it into the system. But it 

accommodates certainly more ethanol than ten percent. 

Mr. LOEBSACK. Well, the third thing I want to address is, it was 

brought up by Mr. Welch—and by the way, I think it is a good 

thing that Democrats disagree with Democrats and Republicans 

disagree with Republicans and not just Democrats and Republicans 

disagreeing. We don’t hear too much about that out there in the 

rest of the country. 

But at any rate, the intent of the RFS was to help the U.S. become more energy independent and secure while also reducing 

greenhouse gas emissions. And I take Mr. Welch’s point about sort 

of evaluating that on the part of the EPA. Each gallon of renewable 

36 

fuel taken away can only currently be replaced by a gallon of gasoline and it doesn’t seem to help address our climate concerns and 

has a potential to greatly reduce investments in the next generation of biofuels which promise even more greenhouse emissions, I 

would argue, greenhouse gas reductions, excuse me. 

Can you tell me how the potential RVOs contribute to the EPA 

and Administration’s goal of greenhouse gas reduction now and 

into the future and how we might be able to measure that to address Mr. Welch’s question as well? 

Ms. MCCABE. Well, Congressman, I think it was you that said 

earlier that every gallon of renewable fuel that replaces a gallon of 

petroleum is bringing the benefits of that fuel. And especially with 

advanced biofuels, the greenhouse gas advantages of that are considerable. 

I will also say in answer to your question that, as I have said 

already, this program has a long trajectory and we are still in the 

early days in terms of the system is really gearing up to produce 

the kinds of fuels that Congress was looking for. So I think that 

people will agree that as this continues to be implemented people 

will be able to see more and more actual impact. But even today 

when you use those renewable fuels you are replacing petroleum 

and moving toward that goal that Congress set. 

Mr. LOEBSACK. Thank you. Thank you. Thank you, Mr. Chair. 

Mr. WHITFIELD. The gentleman’s time has expired. At this time 

I recognize the gentleman from Pennsylvania, Mr. Pitts. OK. At 

this time we will recognize the gentleman from West Virginia, Mr. 

McKinley. 

Mr. MCKINLEY. Thank you, Mr. Chairman. Two quick questions 

if I could, Ms. McCabe, and again welcome back. It is my understanding that you can’t blend ethanol with diesel fuel and the market will not accept more than two to five percent of the biodiesel 

blend in diesel; is that correct? 

Ms. MCCABE. Well, I am not an expert on this issue. I would be 

glad to get you specific answers. But there is a blend concept relative to diesel as there is—— 

Mr. MCKINLEY. Under biodiesel we might be able to do that two 

to five percent, but the EPA imposes the same proportional RIN obligation on all refiners, even some that produce significantly more 

diesel than gasoline. From what I understand, these diesel-rich refiners can’t separate enough RINs to meet their obligation and so 

they are forced to buy RINs to offset that. And one in my district 

it is going to cost him millions of dollars and they are just a small 

boutique-type refinery that is being hurt with this. 

So I am curious, can’t we develop or would you be willing to develop a refiner’s obligation for corn at one level, excuse me, ethanol 

on one for gas and a separate one for diesel fuel? Would that not 

make sense that we separate the two rather than treat them as 

equal because they are not? Would that make any sense to you? 

Ms. MCCABE. Well, I don’t think that is the way that the statute 

was set up, and through the way the statute was set up and then 

the rules that EPA set up—and I wasn’t there at that time so I 

wasn’t personally involved, but the notion that the RIN market as 

a big open and flexible and liquid market was the best tool for the 

refiners to be able to meet their obligations under—— 

37 

Mr. MCKINLEY. OK. But would it make sense to have two separate obligations, one for diesel and one for gasoline? 

Ms. MCCABE. We would be glad to talk with you about that further. 

Mr. MCKINLEY. Let us pursue that a little bit because I think we 

have a unique situation with a small refinery that is being penalized because they are producing far more diesel than gasoline but 

yet they have this problem. 

Let me go to another question. Does the EPA assume that their 

RIN bank will increase or decrease once the obligated parties begin 

reporting their RIN compliance for 2014, 2015, and 2016? Do you 

think it is going to increase or decrease? 

Ms. MCCABE. I don’t know that I have an opinion right now. We 

watch these numbers on an ongoing basis and I think the RIN 

bank has been relatively stable. You know, people can, they have 

these credits, they can use them the next year and so they roll 

over. 

Mr. MCKINLEY. OK. But if perhaps the RIN bank is depleted, if 

it is depleted which apparently that is what a lot of refiners are 

expecting that to happen on it, would the EPA consider adjusting 

their proposal to account for the shortage of RINs in the market? 

Ms. MCCABE. Well, we think that the RIN bank is a really important feature of the program because it provides that cushion for 

manufacturers and they accumulate RINs in a RIN bank to provide 

them with that kind of security. So in the proposal that we put out, 

we designed it in a way that did not have an expectation that the 

RIN bank would be used to satisfy these obligations. 

Mr. MCKINLEY. OK. I yield back the balance of my time. I hope 

that maybe we can sit down and talk about how we might be able 

to treat the small refinery different than someone else. Thank you 

very much. I yield back. 

Mr. WHITFIELD. The gentleman yields back. At this time the 

chair recognizes the gentleman from New York, Mr. Tonko, for 5 

minutes. 

Mr. TONKO. Thank you, Mr. Chair. 

Ms. McCabe, what are the greenhouse gas emission benefits of 

advanced biofuels, and just how much cleaner are they required to 

be? 

Ms. MCCABE. Per Congress, advanced biofuels have to be 50 percent cleaner and cellulosic have to be 60 percent cleaner. 

Mr. TONKO. And can you give your perspective on the state of the 

advanced biofuels industry in terms of perhaps domestic production 

how much has been added, and into the future what is the expected growth rate in the coming years? 

Ms. MCCABE. Yes. That is the question, Congressman, so we stay 

in very close touch with the domestic industry. There is the biodiesel industry, which has had a very optimistic and good growth 

and continues to and has invested and is producing increasing 

amounts of volume. 

On the cellulosic side that has been a little bit harder for those 

firms to get going. There are, however, a handful of firms in the 

country that are now starting to produce actual volumes and generate RINs. That is very encouraging. It is still at a pretty small 

level and certainly way below what Congress would have expected 

38 

by now or was hoping for by now. But we see it on an upward 

trend. That is why it has been our focus to get these volume standards back on track, get them out on time so that there is more certainty in the market for those to develop. 

We have done some, working on some other things, improved our 

pathway approval process which is ways for people to come in with 

new production processes to get those approved to be able to generate RINs. We are now processing those very, very quickly so that 

those can move through and we have I would say a study stream 

of those. So I think it is on the upturn for sure. 

Mr. TONKO. And you certainly see some of those barriers being 

lowered now from—— 

Ms. MCCABE. I think with certainty in the market, with greater 

consumer acceptance and desire for a variety of fuels that we will 

see those penetrating more. 

Mr. TONKO. Thank you. And Mr. Gruenspecht, I believe for the 

first time since the 1970s there are higher levels of carbon dioxide 

emissions from the transportation sector than from the electricity 

generation sector. Is that accurate? 

Mr. GRUENSPECHT. I think that may be coming to be the case 

mostly because of the drop in the electricity sector carbon dioxide 

emissions. 

Mr. TONKO. And what factors, are there factors that would enable the transportation numbers to overcome the electricity numbers? 

Mr. GRUENSPECHT. I am not sure I understand the question, sir. 

Mr. TONKO. Well, if there is now this overwhelming or this bypassing of the electricity carbon emission numbers by the transportation sector, how would you explain that phenomenon from having 

happened? 

Mr. GRUENSPECHT. Well, again, primarily driven by the drop in 

the electricity sector with less coal fire generation, more renewable 

generation, more natural gas generation which is much lower in 

carbon emissions than coal-based generation. 

On the transportation side, I think we have significant fuel economy standards that are being phased in over, you know, through 

for light duty vehicles through 2025. In the present environment 

right now, I think we have rising gasoline consumption. There is 

interesting questions as to why that is the case, so there may be 

obviously lower gasoline prices, a lot of job creations in recent 

years, so when people get jobs they drive to work often. So lower 

gasoline prices, drive to work more, and also the vehicles that people are buying are changing. 

So yes, present each year the fuel economy standards are getting 

tougher, but remember there are separate ones for depending on 

the footprints of the vehicles. So if the mix between larger and 

smaller light duty vehicles, let’s say, what are called light trucks 

and cars, if the balance is shifting more toward light trucks you 

will find even with the standards getting tougher for each of them 

maybe the fuel economy of new vehicles, let’s say over the last couple of years, has actually not decreased. 

Of course those new vehicles only get added to the fleet stock of 

vehicles, but I think the rate of change in fleet fuel economy has 

39 

not declined as much because of some of these changes as some 

people might have thought. 

Mr. TONKO. OK. Well, thank you for that. And with that Mr. 

Chair, I yield back. 

Mr. WHITFIELD. The gentleman yields back. At this time the 

chair recognizes the gentleman from Kansas, Mr. Pompeo, for 5 

minutes. 

Mr. POMPEO. Thank you, Mr. Chairman. 

Ms. McCabe, in your opening testimony you said we believe these 

proposed volumes are achievable. You listed a series of volumes for 

that. Do you really think they are all achievable? Do you think that 

without RINs do you think those volumes will be reached? 

Ms. MCCABE. The ones that we have proposed? 

Mr. POMPEO. Yes. 

Ms. MCCABE. We do think that those are reasonably achievable. 

Mr. POMPEO. Great. We will come back in a year and see how 

you score against that. Your track record is pretty poor in achieving that whether those proposals have exceeded, so this would be 

a first. That would be great. I hope you are right. Now let me just 

keep going. 

Ms. MCCABE. All right. 

Mr. POMPEO. We talked about the obligated party with Mr. Olson 

for a moment. You are convinced you have the authority without 

statutory change to change the obligated party. That is, it is an administrative task. You have the authority if he has the authority 

to change who the obligated party is. Is that correct? 

Ms. MCCABE. I believe that is right. We did it by regulation to 

begin with. 

Mr. POMPEO. I agree. And in 2010 when RFS2 came out, you said 

that if the RIN market went—I want to summarize because it is 

long. If there were problems in the RIN market you would revisit 

this, and you said now in light of the petitions you have received 

you are in fact revisiting who the appropriate obligated party 

might be. 

Ms. MCCABE. We are looking at those issues, yes. 

Mr. POMPEO. But you are not willing to give us any timeline for 

when you might tell us what it is, your ultimate judgment comes 

to be? 

Ms. MCCABE. I don’t have a timeline right now. 

Mr. POMPEO. Great, thank you. You said where at the beginning 

of the program a little bit earlier it ends in 2022 in one sense. That 

is, the requirements end. The program, however, continues forever. 

Tell me what restrictions there are on what volume levels will be 

set by the EPA after 2022. 

Ms. MCCABE. This is what I understand from the statute. The 

statutory volumes end in 2022 as you said, the EPA is then directed to set those thereafter. We are to do it based on our review 

of the implementation of the program on the list of criteria considerations that Congress put in. And I believe there are two minimum expectations, one relates to biodiesel and one relates to advanced and that we are to have minimum volumes at least as great 

as the last ones we set. 

Mr. POMPEO. For those two items? 

Ms. MCCABE. Yes, I believe that is right. 

40 

Mr. POMPEO. I think that is right as well. So it is the case that 

you could completely eliminate the corn based requirement. That 

would be within your statutory authority to completely eliminate 

the corn-based requirement post-2022 volumes that are set forth in 

the statute. 

Ms. MCCABE. I haven’t looked at that question explicitly, but I 

don’t believe there is an expectation in the statute itself with respect to what is not advanced. There is no corn-based or conventional mandate in the statute. It is what fills up the space between 

advanced and total. 

Mr. POMPEO. I think that is right. The statute specifically lists 

environmental impact as one of the criteria that you should use including climate change as criteria for setting those volumes. Do you 

think that corn-based ethanol has a negative environmental impact? 

Ms. MCCABE. I think that this is a challenging question with 

many considerations, and I think in—— 

Mr. POMPEO. But what do you think? You have been looking at 

this for an awfully long time. 

Ms. MCCABE. So in some respects there are greenhouse gas benefits. A lot of it depends on the feedstock and the particular lifecycle 

elements of any particular feedstock including corn. There are some 

advanced fuels that can be made with corn materials as well as 

conventional corn ethanol. 

Corn ethanol has differing impacts on other environmental features such as air quality. In some cases it reduces air pollution, in 

other cases it may increase air emissions. So it is a very mixed picture. 

Mr. POMPEO. The Administration entered into what they commonly called the Paris Agreement. Assuming that the United 

States is still party to the Paris Agreement in 2022, would the EPA 

consider that as a factor as it is evaluating America’s attempt to 

comply with its commitments under the Paris Agreement? Would 

the EPA consider that as it is deciding what the appropriate level 

should be from 2022 and beyond? 

Ms. MCCABE. I can’t speak to what the EPA might do in 2022. 

I think its first priority would be to implement the statute. 

Mr. POMPEO. Right. But I am asking would it be appropriate to 

consider an agreement, a climate change agreement that the Administration entered into as a criteria as it is evaluating whether 

or not its levels that it sets post-2022 would comply with the statute? 

Ms. MCCABE. Well, I think that the RFS and other programs 

that are climate focused provide the support for the United States’ 

commitment internationally, not the other way around. But I can’t 

speak for a future EPA. 

Mr. POMPEO. Do you believe you would have in 2023 the statutory authority to restructure the RFS to mirror the California Low 

Carbon Fuel Standard Program? Could you do that, would have the 

authority to do that? 

Ms. MCCABE. I don’t know, Congressman, but would be happy to 

follow up with conversation on that point. 

Mr. POMPEO. Thank you. I yield back. 

41 

Mr. WHITFIELD. The gentleman yields back. At this time the 

chair recognizes the gentleman from Virginia, Mr. Griffith, for 5 

minutes. 

Mr. GRIFFITH. Thank you very much, Mr. Chairman. I do appreciate that. Thank you all for being here today. 

I am trying to sort some of these things out. I am concerned 

about the comments about the wildlife habitat that has been destroyed as a part of this that Mr. Welch brought up earlier. And 

I thought it was really nice that one of my colleagues mentioned 

that sometimes Republicans don’t agree with Republicans and the 

Democrats don’t agree with Democrats and the issues get a little 

blurred particularly in this area. But I am concerned about that. 

I am also concerned, Mr. Gruenspecht, you indicated in your testimony that the greenhouse gas standards for heavy duty trucks 

might impact RFS. Could you explain a little bit more on that? 

Mr. GRUENSPECHT. Well, the reason I mentioned that in the testimony or the reason that was included, we have heard a lot about 

what was expected, in 2007. And again, in 2007, there was an increase in more stringent fuel economy standards for light duty vehicles which wasn’t reflected in that outlook that apparently people 

relied on even though they were changing the fuel economy standards. 

So all I am saying here is, we have present outlooks and they 

are based on current laws and regulations. Right now those Phase 

2, so-called Phase 2 standards are not part of that although we are 

going to do a side case that looks at the proposed Phase 2 standards because they have already been proposed. 

But in that projection there would be significantly less diesel consumption than in the baseline projection, so we are not trying to 

guess what either the people in Congress are going to do or the 

people in the Administration are going to do. Since we know there 

is a specific proposal we feel like we can put that out there. 

But I guess I put that in the testimony not as a caution but just 

so if someone says, gee, we looked at your outlook and it said there 

would be this much diesel, it is very dependent on policy. Policy 

matters a lot. 

Mr. GRIFFITH. And it is clear that you are trying to be very careful in your projections and so forth, but you did indicate that if the 

greenhouse gas standards for heavy duty trucks are finalized that 

would significantly reduce projected diesel fuel use—— 

Mr. GRUENSPECHT. Exactly. 

Mr. GRIFFITH [continuing]. And these things are going on, the 

lower cost of gasoline has had an impact and et cetera as you have 

mentioned previously in your testimony. 

And then it makes me wonder, Ms. McCabe, when you respond 

to Mr. Pompeo that you are confident that all these goals can be 

met, how can you be so confident when you have got all these different variable factors out there which you have already established in the past that you weren’t able to meet all those goals? 

Ms. MCCABE. Yes, there is a really important factor to mention 

here. Congress set absolute numbers in the statute, but then the 

way the obligation is actually given to the industry is through a 

percent. So because there are absolute numbers in the statute we 

need to be guided by absolute numbers. 

42 

But then the expectation is not that any given producer will 

produce x number of exact gallons based on our absolute number 

but rather on the percentage, so we translate that to a percentage. 

So that means if we are wrong on we predict more gasoline use 

than actually happens or less gasoline use than actually happens, 

the refiner’s obligation it will take that into account because it is 

a percent obligation. 

Mr. GRIFFITH. Well, I appreciate that. I will ask you to give me 

information later because I don’t expect you to have this, although 

some of the answers I thought the questions that were asked I 

thought you might have had answers in preparation for this hearing. 

But biodiesel that comes from grease as opposed to coming from 

plant material, if you can get me whatever it is you all are working 

on in that regard and how you might be increasing that or what 

proposals you may be making behind the scenes to increase the 

amount that is made from waste grease fats. I know there is some 

research out there and if Singapore is looking at it and other folks 

are looking at it to try to take our love of hamburgers and turn it 

into a renewable fuel source. So just give me that information later 

if you would. 

My time is running out and so I would also ask Administrator 

Gruenspecht, according to the U.S. Department of Energy vehicles 

will typically go three to four percent fewer miles per gallon on 

E10, four to five percent fewer on E15 than on a hundred percent 

gasoline. And according to the Institute of Energy Research, Americans have paid about 10 billion in additional cost for the privilege 

of having ethanol blended into their gasoline. 

Can you verify this information, and if it is correct why should 

Virginians in my region of the state continue to be forced to foot 

the bill in order to prop up the ethanol industry? 

Mr. GRUENSPECHT. I think the first set of information is probably 

correct, the lower energy content of ethanol. I am not sure the second set of information about how much it has cost is really open 

to a lot of interpretation. And the reason is, as many of the members have said, ethanol contributes octane which is very important 

to make gasoline good and that we would be, many people I guess, 

Administrator McCabe, myself, some of the members believe that 

we would be using a lot of ethanol in gasoline even if there were 

no RFS requirement. 

So again I am not sure how that 10 billion figure was calculated, 

but if it is providing other necessary parts of gasoline I don’t know 

that you would necessarily call that a cost. So the first part yes, 

I think. 

Mr. GRIFFITH. All right, I appreciate that and I yield back. 

Mr. WHITFIELD. The gentleman’s time has expired. At this time 

the chair recognizes the gentleman from Illinois, Mr. Kinzinger, for 

5 minutes. 

Mr. KINZINGER. Thank you, Mr. Chairman. And before I begin 

my questions I am going to ask unanimous consent to insert into 

the record a study that shows, showing the impact of the EPA’s 

lack of certainty on the biofuels industry titled, ‘‘Estimating Another Year of Chilled Investment in Advanced Biofuels Due to RFS 

Uncertainty.’’ 

43 

Mr. WHITFIELD. Without objection. 

[The information appears at the conclusion of the hearing.] 

Mr. KINZINGER. To the administrator, thank you for your service 

and thank you for being here. I really appreciate it. I just have a 

couple of questions. I am curious how the EPA determined the biodiesel targets for 2017 and the proposed targets for 2018. It is my 

understanding that these targets will both be below the amount of 

biodiesel EPA estimates will be produced this year. Can you elaborate on how they were determined? 

Ms. MCCABE. Sure, happy to do that and to follow up if I am not 

detailed enough for you. So the statute establishes an amount for 

biodiesel through 2012, gets up to one billion gallons and then it 

is up to the EPA to determine an amount after that. So what we 

do with biodiesel is what we do with all of the fuel categories which 

is we get as much information as we can about what the expectations are with respect to the industry. 

But there is a difference with biodiesel because biodiesel is one 

of a number of advanced fuels. It fits into that advanced category 

and we have to set a separate amount, expected amount for the advanced category. And one of the questions is how much of that advanced category should biodiesel basically get a guarantee on? And 

we believe that it is important to have competition and choice and 

opportunity for a variety of fuels to compete. 

So we consider very carefully how much biodiesel can contribute 

because it is very important, right, but also leaving room for other 

fuels to compete. Now it is not a limit on how much biodiesel can 

be produced nor sold, and depending on what other fuels are out 

there and how they are priced it can be very competitive. But in 

fact it has provided a substantial amount of our advanced biofuel. 

So that is the process we go through. We look at the information, 

but then we have this other consideration to make sure that other 

fuels have an opportunity to compete. 

Mr. KINZINGER. OK. And I am sure you appreciate the amount 

of planning that goes into this infrastructure, purchases by obligated parties or preparation made by the ag community which 

comes along with complying with the annual volumes. I am glad 

the EPA is working to get back on schedule with the 2017 rule 

deadlines. 

What are you as an agency doing to ensure that you will remain 

on schedule for 2017 and beyond? 

Ms. MCCABE. Yes. I think we have done a good job of getting ourselves back on track. The big issue was approaching the blend wall, 

the use of the general waiver. We have now used it. We have proposed to use it again. It is being litigated as has been mentioned, 

so presumably will get some direction from a court at some point. 

So some of those very difficult issues are behind us now and so 

we are able to do our routine work, just make sure that we are on 

schedule. We got this proposal out absolutely on time to get a final 

out by November and there is no reason we shouldn’t make that. 

Mr. KINZINGER. So your feeling is that basically from here on out 

we are probably going to be on track better with timing? 

Ms. MCCABE. Well, that is my belief. I won’t speak for future 

EPA leadership, but I feel confident that the program can do it. 

44 

Mr. KINZINGER. OK, thank you. And just in closing to just remind people because there is obviously a lot of talk and it is important, and I have a lot of, a hugely agricultural district and I remember back in the ’90s there was a lot of talk about whether the 

family farmer would be able to survive. And is this just going to 

become in essence major corporations taking over these farms to do 

it? 

And I think ethanol has been a big part of the survival of the 

family farmer and obviously very important going forward, especially when we see corn prices today and knowing that the importance of producing food not just for ourselves but for frankly the 

world and the importance of it. So again, thank you for your service and thank you both for being here, and I will happily yield 

back. 

Mr. WHITFIELD. The gentleman yields back. At this time the 

chair recognizes the gentleman from Texas, Mr. Flores, for 5 minutes. 

Mr. FLORES. Thank you, Mr. Chairman. I thank the witnesses for 

joining us today. 

Mr. Gruenspecht, do you believe that the market can absorb 

14 1⁄2 billion gallons of renewable fuels in the 2016 RVO? I am talking gasoline only for all of my conversation. 

Mr. GRUENSPECHT. Yes, I am an economist and I tend to believe 

in markets. And I think that there are certainly conditions I could 

imagine that the market can absorb that. 

Mr. FLORES. OK. 

Mr. GRUENSPECHT. I don’t know what the RIN prices would be. 

At some point, the higher ethanol blends get very attractive to the 

people who can use them, so I would not rule out anything. 

Mr. FLORES. OK. How about the 14.8 billion gallons for the 2017 

RVO? 

Mr. GRUENSPECHT. Again it is a market-based issue. 

Mr. FLORES. OK, but it could generate a higher RIN cost which 

would generate higher gasoline costs? 

Mr. GRUENSPECHT. Well, again the figuring out—yes, it could 

generate higher RIN costs. Exactly who bears those costs is a very 

complex—— 

Mr. FLORES. OK. So I guess that leads to the broader question. 

What happens to the market if either the 2007 statute and/or the 

EPA continue to push higher and higher volumes of ethanol into 

a fuel market, a gasoline market where volumes have flattened and 

are actually you are predicting to decline? What happens to the 

market? 

Mr. GRUENSPECHT. If I knew the answer to that question I guess 

I wouldn’t be a government official. 

Mr. FLORES. There you go. 

Mr. GRUENSPECHT. But seriously, there are actually, I did try in 

the written testimony, although I didn’t mention it in the oral, 

there are options, higher volume blends which has all kinds of 

issues related to infrastructure that I actually feel like the members here are extremely well informed on this issue, probably better informed than I am to be the truth. 

But the opportunity for something like biobutanol, say, which potentially could be blended at a high—there is no rule that says that 

45 

the biofuel has to be ethanol and biodiesel. There are processes to 

create biobutanol using the same feedstocks, so there are a lot of 

different options. I am not going to say it is a cinch. I am not going 

to say it is, but if—— 

Mr. FLORES. But it could cause market disruption, do you think? 

Mr. GRUENSPECHT. It would definitely change things. 

Mr. FLORES. Exactly. 

Mr. GRUENSPECHT. It might change the blendstocks that have to 

be used in conjunction. 

Mr. FLORES. Let me move on though, we have got a lot of ground 

to cover in a short period of time. 

Ms. McCabe, you and I both understand the EPA has got some 

waiver authority to adjust the volumes, also I think you have essentially admitted that the mandated volumes don’t match the 

trends in consumer fuel demand. And so I believe that means that 

they are technically and commercially unachievable and I think 

that is what the 2017 proposal or the rulemaking by the EPA essentially says is that the statutes can’t be achieved so we the EPA 

are going to do the best we can in an uncomfortable situation. 

So that leads me to the next question. Congress said volumes. 

Would it be easier for you if Congress had just said we set percentages of renewable fuels that have to be blended based on actual 

gasoline demand? Wouldn’t that have been a better solution? 

Ms. MCCABE. Well, as you might expect I am not going to opine 

on what Congress, whether one thing or another would have been 

better for Congress to do. 

Mr. FLORES. But you have to implement these things. Would it 

have been easier for you to implement if you had a percentage 

mandate instead of a volumetric mandate? 

Ms. MCCABE. Well, I think we would, Congressman, go through 

much of the same inquiry to make sure that whether it is expressed as a percentage to begin with or whether it is an actual 

volume that then is translated to a percentage, we would still be 

inquiring into where the industry is going and what is feasible and 

realistic. So, and I think we would be doing a lot of the same work. 

Mr. FLORES. OK. Wouldn’t though, let’s put it this way. Right 

now every year, everybody involved in the gasoline market if you 

will, whether it is a consumer, a refiner, a corn grower, an advanced ethanol company, goes through an extreme amount of uncertainty because they just don’t know what the EPA is going to 

do, because they know there is a statute out there that is 

volumetrically driven that cannot be achieved through the current 

technology and current market conditions. 

So wouldn’t it be better and more stable for the market if there 

was an easily understood percentage mandate instead of a volumetric mandate? 

Ms. MCCABE. Well, I think uncertainty has been a real concern 

of people and that is why it is so important for us to get our rules 

out on time. But even if we get them out on time it is an annual 

process, right. So people have those concerns. 

Mr. FLORES. Let me say this. I think the market would respond 

better just knowing, OK, expected gasoline demand is x and the 

percentage is y and therefore the outcome that the market has to 

be driven toward is z. That is a lot simpler. There is a lot more 

46 

stability and a lot more transparency to the market. Thank you. I 

have overstayed my welcome. I yield back. 

Mr. WHITFIELD. The gentleman yields back. At this time the 

chair recognizes the gentleman from Mississippi, Mr. Harper, for 5 

minutes. 

Mr. HARPER. Thank you, Mr. Chairman. 

Ms. McCabe, at a Senate hearing earlier this year you indicated 

that the EPA in consultation with the DOE has continued to grant 

small refinery hardship waivers. For those that were denied was 

the denial based on their profitability, and has DOE and EPA implemented a new hardship standard by which you are denying 

hardship relief to refineries that remain profitable even if they 

have a disproportionate regulatory burden by producing more diesel than the national average and lower refining margins? 

Ms. MCCABE. We do continue to look at hardship waivers and we 

have a pretty standard number of them every year and we coordinate closely with the DOE. We worked with the DOE and the DOE 

developed an evaluative process that they use to then give us a recommendation and they used a couple of different factors. As you 

know, DOE has recently made some adjustments in their process 

based on some recommendation language that they got through 

legislation directed to them. We continue to coordinate with the 

DOE, but we however feel that our job is to implement the statute 

and to exercise our hardship waiver authority in conjunction with 

the statute. So we take DOE’s input but we have not made changes 

in our process that are consistent with the DOE changes that they 

have made in response to direction that they got. 

Mr. HARPER. Well, I am not sure I really got an answer to my 

question. Is profitability a factor in approving or denying a hardship petition? 

Ms. MCCABE. Yes, it is. There are a number of economic factors. 

It is one of a number of factors. 

Mr. HARPER. So their profitability is a factor. So you could have 

two entities doing the same amount of work but one is not profitable, the other one is for whatever reason it is, and the hardship 

waiver may be granted to the refinery that is financially not as viable or as profitable, and the one that may be doing it right and 

more profitable is going to get denied under the same set of circumstances. 

Ms. MCCABE. These are really complicated decisions, Congressman, and they are—— 

Mr. HARPER. Well, it is pretty complicated when you are being 

punished for trying to do it right and denied this in this regard. 

Ms. MCCABE. Well, Congressman, when somebody comes and 

asks for an exemption that means that they are asking to not be 

expected to do what the rest of the industry is asked to do. And 

so we look at these very, very carefully, because it matters greatly 

to the person coming to us but it also matters greatly to everybody 

else that has that burden. And that is why we think that the range 

of factors we have established are appropriate ones. 

Mr. HARPER. And I know you have mentioned it and I would 

maybe not agree with you that they are appropriate and maybe 

need to be looked at closer, and you have mentioned the language 

included in the Omnibus Appropriations bill last year restating 

47 

congressional intent regarding small refiner hardship. Can you 

please tell me how the EPA intends to apply to small refiner hardship petitions going forward? 

Ms. MCCABE. That language was directed towards DOE’s process 

and how they would make their recommendations to the EPA. And 

so they are doing that and we are paying attention to DOE’s recommendations as we always do and to the analysis that goes into 

their ultimate recommendations. We are making our decisions 

based on our understanding of what our statutory obligations are. 

Mr. HARPER. For hardship petitions that are submitted this year 

will you follow the 90-day time clock for a response? 

Ms. MCCABE. Yes. 

Mr. HARPER. OK. Mr. Chairman, I don’t believe I will have 

enough time to get into another question here, so I will yield back. 

Mr. WHITFIELD. The gentleman yields back. At this time the 

chair recognizes the gentleman from Oklahoma, Mr. Mullin, for 5 

minutes. 

Mr. MULLIN. Thank you, Mr. Chairman. And thank you for taking the time to be here. So I am going to focus on a couple of things 

real quick since you are the economist on the panel today. With the 

RIN’s price what is the current price today on the RINs, do you 

know? 

Mr. GRUENSPECHT. I probably have it written down somewhere. 

Mr. MULLIN. 85 cents. 

Mr. GRUENSPECHT. Sounds right. 

Mr. MULLIN. OK. And before the blend wall do you know what 

the RIN’s price was? 

Mr. GRUENSPECHT. I know that for a long, long time the RFS 

wasn’t binding at all. We were using much, much more ethanol 

than required by the RFS and the RIN prices were—— 

Mr. MULLIN. Right. Before the blend wall it was like trading between 2 and 4 cents. At its highest point it was costing 1.48. Do 

you know what the total was going to the refineries, what the refineries were spending on this? 

Mr. GRUENSPECHT. I am not sure. The blenders were buying ethanol—— 

Mr. MULLIN. But the refineries were forced to buy them even 

though—— 

Mr. GRUENSPECHT. Right. 

Mr. MULLIN [continuing]. This blend was out of their control. 

Mr. GRUENSPECHT. Right. 

Mr. MULLIN. Do you know how much the refineries were costing 

them? 

Mr. GRUENSPECHT. I am not sure because when they bought ethanol it had RINs attached, so the question is how much—— 

Mr. MULLIN. How much does it—OK, let me rephrase this then. 

How much is the RINs costing the consumer out there? How much 

is it adding to a gallon of gas? 

Mr. GRUENSPECHT. I am actually not sure I know the answer to 

that question, honestly. It is a tricky question because—— 

Mr. MULLIN. Well, it is but you are the economist. 

Mr. GRUENSPECHT. I understand that. 

Mr. MULLIN. And so that is why I am asking you the question 

because this is part of the debate. Is this healthy for the consumer? 

48 

If ethanol is a cheaper, better, smarter way to move forward we are 

talking today about what is the percentage of the blend, what is 

it required, and then the bigger picture is what is it actually costing the consumer? We already know that as a guy that has over 

a hundred vehicles on the road in my company and that we have 

multiple small engines out there—we are in the construction business—we know it is not healthy for our vehicles. I don’t think either side is even debating that. 

So if it is not healthy for our vehicles we are wanting someone 

to tell us, where is it good? Is it good for the economy? 

Mr. GRUENSPECHT. I have not looked at that sir. 

Mr. MULLIN. So—— 

Mr. GRUENSPECHT. A challenge as we discussed earlier is that 

the ethanol serves multiple purposes in the fuel, so it adds octane, 

it helps meet other kinds of requirements unrelated to the RFS. 

Mr. MULLIN. But are they the smarter, better way to move forward? I mean for the economy, you are an economist. 

Mr. GRUENSPECHT. Yes. 

Mr. MULLIN. Is it healthy for the economy? 

Mr. GRUENSPECHT. I am actually not sure it is a primary consideration for the economy. It is more of a consideration for fuels policy and environmental policy. There are definitely effects. 

Mr. MULLIN. Well, for the environmental policy—— 

Mr. GRUENSPECHT. I think it affects the agricultural community 

to some extent. I mean—— 

Mr. MULLIN. Well, sir, for the environmentalist, let’s just talk 

about that. I think you said it was higher fuel standards; is that 

what you said earlier? You were answering a question and you 

spoke about higher fuel standards. And so let’s talk about the environment. Ethanol doesn’t burn better. I get less miles per gallon in 

my vehicles when we burn ethanol. 

Mr. GRUENSPECHT. Absolutely. Ethanol has less energy content 

than gasoline. 

Mr. MULLIN. On our vehicles we run about 150 vehicles of one 

particular brand. When I run non-ethanol versus ethanol I see 

roughly a 12 percent increase in fuel mileage, when I run 100 percent fuel E0. And so for the environment that is not good, so I focus 

once again on the economy side of things. Where is it good? 

And I don’t mean to be pinning you, but you are the economist 

and I find it funny that we can’t get an answer on that; that no 

one has studied downstream. Because we always talk about the 

consumer, we always talk about the middle class, we always talk 

about how much better and healthier it is for them and lower fuel 

standards, but I am just not seeing it. 

Mr. GRUENSPECHT. All right. Again it is something we could look 

at. I think there are a variety of views on it, a variety of perspectives on it. 

Mr. MULLIN. So the EPA has never looked at this? 

Mr. GRUENSPECHT. Well, I can’t speak for the EPA. 

Mr. MULLIN. Ma’am? 

Mr. GRUENSPECHT. That sounds like throwing my colleague 

under the bus, but—— 

Mr. MULLIN. But you think some economists should be looking 

at this? 

49 

Ms. MCCABE. Yes, we have economists at EPA as well who look 

at these issues. A couple things I will say in response to the points 

that you have made, there has been development in rural America 

as a result of the investment in not just ethanol but other renewable fuel operations, and I am sure you will hear that from the second panel to a great degree. So it has added to the economy in that 

way. 

Mr. MULLIN. What has it added to other than higher consumer 

prices? 

Ms. MCCABE. Well, it has created jobs and—— 

Mr. MULLIN. At the cost of who, the consumer. We have created 

jobs through regulation. 

Ms. MCCABE. Well, so another point that I want to be sure to 

make is that a lot of people have looked at and are looking at the 

dynamics of the RIN price and does it or doesn’t it affect prices at 

the pump for the consumer. And—— 

Mr. MULLIN. It has to, because it has cost the refineries billions 

of dollars and who do they pass it on to? As a business owner I 

have got to pass my regulation costs to someone. You can’t absorb 

it. That is why I find it odd that we through either economists or 

the EPA haven’t looked at this downstream on actually what it is 

costing the consumer at the pump. 

Ms. MCCABE. We actually have looked at this issue in great detail and would be glad to follow up with you and provide some 

more information on it. 

Mr. MULLIN. Please do, I would appreciate that. Thank you so 

much. 

Mr. WHITFIELD. The gentleman’s time has expired. At this time 

the chair will recognize the gentleman from Ohio, Mr. Johnson, for 

5 minutes. 

Mr. JOHNSON. Thank you, Mr. Chairman. And I appreciate the 

panel for joining us today. Ms. McCabe, how might the EPA go 

about setting blending requirements differently after 2022, fully 

understanding that a different President and Administration will 

be in place at that time? 

Ms. MCCABE. Yes, sir. Well, thank you for recognizing that I 

won’t speak for a future EPA. But we would use the guidance that 

Congress gave us in the statute. So our job is to look at the list 

of considerations and concerns that are laid out in the statute 

which are very explicit. We are to look at the implementation of 

the program through 2022 and take that into account, and we are 

to also make sure that we set minimum requirements for advanced 

fuel that are no less than the last level that we set in 2022, and 

likewise for biodiesel. And so those are two specific directions that 

Congress gave us, and beyond that we would use our consideration 

of the list of factors. 

Mr. JOHNSON. Do you anticipate any immediate or significant 

changes to blending requirements once the EPA is not bound by 

these statutory requirements? 

Ms. MCCABE. That is something I really can’t speak to. It is not 

only would it not be me, it is many years into the future. 

Mr. JOHNSON. OK. Do you believe that the agency is on track to 

meet all statutory blending requirements by 2022? 

50 

Ms. MCCABE. I think we have made clear that the statutory volumes that Congress put, the actual numbers that Congress put 

into the statute we will not be able to make, and so that is why 

we have used our waiver authority in this proposed rule and the 

last one to set standards that are less than that. 

Mr. JOHNSON. So if you can’t meet the statutory blending requirements by 2022, then how many more years might the agency 

need to achieve those blending requirements, any idea? 

Ms. MCCABE. The actual numbers in the statute? 

Mr. JOHNSON. Yes. 

Ms. MCCABE. I really wouldn’t know. 

Mr. JOHNSON. I mean, if you know you are not going to meet 

them have you not looked at how long it would take you to meet 

them? 

Ms. MCCABE. I don’t believe we have looked at that, Congressman, because we know that there is a process for us to set appropriate but aggressive standards in the meantime. We know that 

there is a process in the statute for what happens afterwards and 

that would, I expect, be the intent of the agency would be to follow 

that process. 

Mr. JOHNSON. It seems to me that because these are statutory 

requirements that the agency would be planning to meet the statutory requirements, and if not, at least inform Congress as to when 

they expected to be able to meet them. But you say you haven’t 

looked at that. 

Ms. MCCABE. Well, if Congress asks us that specific question we 

would do our best to answer it. I can tell you that the expectation 

for 2017, which is the proposal we have out now, I believe is a total 

volume of 24 billion gallons and our proposal is 18. So that is the 

delta on the total. 

Mr. JOHNSON. OK. One final question, Ms. McCabe. EPA’s CAFE 

and GHG standards came out after the RFS was last revised. Explain how this program changes compliance with the RFS. 

Ms. MCCABE. Yes, sir. That is a good question and it is actually 

one that has been present in a lot of these questions today. I mentioned a few minutes ago that the way the statute works is it starts 

from absolute numbers, but then the actual obligation for the obligated party is converted into a percent. And what that means is 

that the obligation can be sensitive to increases or decreases in fuel 

use. 

So you have noted that there are programs in place now that we 

didn’t have before that require increased fuel economy that could 

well lead to less fuel being used overall, maybe not for some of the 

reasons that Howard mentioned, but whether it is higher or lower 

the percentage obligation for each obligated party will be able to 

adjust. 

Mr. JOHNSON. OK, all right. Mr. Chairman, I don’t have time for 

another question either, so I yield back. 

Mr. WHITFIELD. The gentleman yields back. And that concludes 

all of the questions for the first panel. So Ms. McCabe and Mr. 

Gruenspecht, thank you very much for being with us and you are 

dismissed. 

51 

At this time I would like to call up the second panel of witnesses. 

And you all take a seat and we will just introduce each of the witnesses as we call on them to give their opening statement. 

OK, our first witness on the second panel will be Mr. Chet 

Thompson, who is the President of the American Fuel and Petrochemical Manufacturers. And all of you are experienced witnesses, 

but I would just remind you to pull the microphone up and make 

sure the microphone is on. And when the red light goes on that 

means your time is up, but we will give you a few minutes to wind 

up. 

So Mr. Thompson, thanks very much for being with us this 

morning. We look forward to your testimony, and you are recognized for 5 minutes. 

STATEMENTS OF CHET THOMPSON, PRESIDENT, AMERICAN 

FUEL AND PETROCHEMICAL MANUFACTURERS; BOB 

DINNEEN, PRESIDENT AND CEO, RENEWABLE FUELS ASSOCIATION; TODD J. TESKE, CHAIRMAN, PRESIDENT, AND CEO, 

BRIGGS & STRATTON CORPORATION; BROOKE COLEMAN, 

EXECUTIVE DIRECTOR, ADVANCED BIOFUELS BUSINESS 

COUNCIL; COLLIN O’MARA, PRESIDENT AND CEO, NATIONAL 

WILDLIFE FEDERATION; ANNE STECKEL, VICE PRESIDENT 

OF FEDERAL AFFAIRS, NATIONAL BIODIESEL BOARD; AND 

TIM COLUMBUS, GENERAL COUNSEL, NATIONAL ASSOCIATION OF CONVENIENCE STORES AND SOCIETY OF INDEPENDENT GASOLINE MARKETERS OF AMERICA 

STATEMENT OF CHET THOMPSON 

Mr. THOMPSON. Thank you, Chairman. I appreciate the opportunity to be here. To all the members of the subcommittee, again 

my name is Chet Thompson and I am the president of the American Fuel and Petrochemical Manufacturers. AFPM represents the 

domestic petroleum refining sector. Our members account for 98 

percent of the capacity of the refining industry which transforms 

crude oil into the many fuels and products that Americans rely on 

for their everyday life. Unlike others on the panel, our members 

are obligated parties under the RFS, which means we are the ones 

left holding the bag if this program is not properly implemented. 

I would like to use my limited time just to touch on the key 

points we made in our written testimony. First, the RFS is irreparably broken and needs to be repealed. After more than a decade 

of implementations, it is clear to almost everyone but our friends 

in the biofuel industry that the RFS program is not working as 

Congress intended, and that the two purposes cited by Congress for 

establishing the program—energy security and emission reductions—are either no longer an issue and are not being addressed 

by the program or in fact being made worse by the program. 

The United States is more energy secure now than ever before, 

and indeed we are the world’s largest producer of oil and natural 

gas. And according to EIA—you heard it this morning—the RFS 

has played only a small part in this transformation. 

Mr. WHITFIELD. Mr. Thompson, would you pull the microphone 

a little bit closer? We are having a little bit of difficulty hearing. 

52 

Mr. THOMPSON. Not enough rope here, I will move closer. And so 

as I was saying, the RFS has played only a small part in this 

transformation in making us more energy secure. And the notion 

that the RFS program is better for the environment is at best debatable, and many including the National Academy of Sciences believe the RFS may in fact be a negative to the environment. The 

time has come for Congress to repeal the RFS and let the biofuels 

industry stand or fall on its own like all the other industries in this 

country. 

Second and importantly, AFPM, we are not anti-biofuel. To the 

contrary. Several of our members are large ethanol and biofuel producers. We believe biofuels play an important role in the U.S. fuel 

supply and will continue to do so even when this body repeals the 

RFS. What we are however is anti-government mandates. 

Third, as to last year’s standards and this year’s proposal, we 

support EPA’s acknowledgment that the ethanol blend wall is real 

and that we also support their decision to use their general waiver 

authority to adjust the standards accordingly. That said, we do not 

believe that EPA has gone far enough to ensure the annual standards are in fact reasonably achievable. 

The RFS requires increasing volumes of biofuel to be squeezed 

into an inadequate biofuel infrastructure and a decreasing demand 

for transportation fuel and also confronts a fact that consumers’ demand for these programs, or these fuels are just nonexistent. 

This is what gives rise to the blend wall, and as EPA has repeatedly recognized, only a tiny fraction of the fuel distribution and retail infrastructure is designed to accommodate fuels containing 

more than 10 percent ethanol. Moreover, the vast majority of cars 

on the road today are not warrantied to handle more than E10 and 

nor are the small engines equipped to handle these blended fuels. 

Demand is much lower—again we heard this from EIA—today than 

Congress thought when they enacted the program. Projections for 

2007 are down by more than 10 percent and projections for 2022 

use has dropped by more than 23 percent. 

To overcome this and meet its aggressive 2017 proposals, EPA 

would eliminate in 1 year starting 6 months from now their proposal would eliminate 96 percent of the ethanol-free gasoline or E0, 

taking it from 5.3 billion gallons down to just 200 million. It would 

also require consumers to purchase record-breaking volumes of 

E85, E15, and biodiesel, ignoring the very obstacles they acknowledge in the rulemaking still exist today. If biofuel production so far 

this year is any indication, EPA’s proposed standards are indeed 

unachievable. 

As the former deputy general counsel of EPA, I would be remiss 

not to mention that the Clean Air Act clearly provides EPA with 

the authority to adjust annual standards to account for the E10 

blend wall. The biofuel industry’s challenge to this authority is simply without merit. 

Finally, AFPM strongly supports H.R. 5180, the Food and Fuel 

Consumer Protection Act of 2016. While certainly we would prefer 

full repeal of this program, the Association fully supports H.R. 

5180 introduced by Congressman Flores and Welch and cosponsored now by ten members of the subcommittee. This legislation 

would prevent EPA from forcing more ethanol into the fuel market 

53 

than it can handle, which in turn would provide at least some stability in the RIN market and preserve some consumer choice for 

ethanol-free gasoline. This legislation importantly represents a 

good faith compromise on our part that deserves the support of 

every member of Congress. Thank you, and I look forward to answering your questions. 

[The prepared statement of Chet Thompson follows:] 

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Mr. WHITFIELD. And thank you, Mr. Thompson. And our next 

witness is Mr. Bob Dinneen who is the President and CEO of the 

Renewable Fuels Association. Welcome, Mr. Dinneen, and you are 

recognized for 5 minutes. 

STATEMENT OF BOB DINNEEN 

Mr. DINNEEN. Thank you, Mr. Chairman. Good afternoon, members of the committee. I must confess I am feeling a little bit nostalgic this morning reflecting on the many times I have testified in 

this room on this very subject going back to 2002, as the committee 

wrestled with how best to accommodate oil companies looking to 

eliminate the requirement to use MTBE, a petroleum-based additive contaminating drinking water across the country. The result 

was the first RFS supported by the oil industry and a bipartisan 

majority here. 

The success of that bill gave rise to the expanded RFS in 2007, 

creating the very first carbon metric for liquid fuels. RFS2 was 

transformative legislation and it is accomplishing everything it was 

asked to do. It was intended to stimulate investment and expansion of conventional ethanol—done. U.S. ethanol producers met the 

challenge and we now have the capacity to produce more than 15 1⁄2

billion gallons annually. It was intended to create a value-added 

market for farmers—done. Ethanol has created a robust ag economy that importantly allowed Congress to reduce farm program 

costs saving taxpayers money. 

It was intended to provide competition at the pump—done. Ethanol is the lowest cost octane on the planet and because it is cheaper than gasoline has reduced petroleum demand and extended the 

barrel. It has significantly reduced consumer prices. It was intended to enhance energy security—done. U.S. oil dependence has 

plummeted in part because of fracking, but most certainly also because of ethanol. Indeed, gasoline imports have virtually been 

eliminated in direct response to the RFS. 

It was intended to reduce carbon—done. Ethanol produced today 

reduces greenhouse gas emissions 34 percent relative to gasoline, 

and ethanol from tomorrow’s cellulosic feedstocks will do even better making the RFS the single most effective transportation related 

carbon policy in the world. It was intended to stimulate investment 

in advanced biofuels—doing. While the inexorable march towards 

cellulosic ethanol was interrupted by the worldwide recession and 

banking crisis precipitated by $140 a barrel oil in 2008, these technologies are now rolling out and the promise of advanced biofuel 

technology is being realized. 

So what has changed from when the RFS passed with such broad 

enthusiasm? Some have said, well, the RFS is driving up food 

costs. No, the price of corn today is about where it was in 2007. 

Retail food price inflation has actually been demonstrably lower 

since the RFS2 was passed, and as the World Bank reported again 

just last week, demand for ethanol has not had a meaningful impact on world food prices. Rather, the price of food is far more related to the price of oil. 

Refiners will say we are producing more crude oil domestically 

and the RFS is just an anachronism of our energy scarcity past. 

Well, we have been reminded lately of the boom and bust cycle that 

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is oil extraction as the rig count has plummeted. 80,000 workers 

were laid off and fracking operations in the Bakken have shuttered, leaving communities holding the lost hope of economic opportunity. Faced with the same falling oil prices, U.S. ethanol producers added 2,000 jobs last year, invested in new technologies, 

and worked to build new markets here and abroad. Tell me what 

has been better for America. 

Some, including EPA, have said we have hit a blend wall. We 

can’t blend any more than 9.7 percent of the gasoline market. 

There aren’t enough cars that can run on more than ten percent, 

and boats and small engines will be harmed if forced to use the 

higher ethanol blends. Hogwash. There is nothing magical about 

9.7 percent. Twenty seven states today already use more, 23 states 

use more than ten percent, and Minnesota uses 12.2 percent all because of the increasing demand for E15 and E85. 

Today, more than 25 percent of the vehicles on the road are fully 

warrantied for E15 or higher. Eighty percent of the new cars produced last year were warrantied for E15. For comparison, just 11 

percent of the cars on the road today require premium. You can 

find premium every place, so what is the big challenge about providing that E15 fuel for those consumers that want it and can use 

it? 

That said, there is no mandate for E15. Even API says E0 is on 

the rise and E10 will remain the ubiquitous fuel option. The pumps 

selling E15 will be clearly labeled. There is no reason to believe 

folks needing E10 or less for their small engines, boats, or motorcycles will be unable to find it. 

Now the only thing that has changed is the incumbent industry 

is fiercely trying to relitigate the legislative battle it lost a decade 

ago. But the policy objectives, energy, economic, and environmental 

security have not subsided. Indeed, they have become even more 

critical as the planet warms, consumers struggle, and OPEC flexes 

its muscle. 

This committee wrote a great law in 2005. You gave EPA very 

clear guidance on how to implement the program and the flexibility 

to deal with issues. There is nothing wrong with the RFS that cannot be fixed with what is right with the RFS. There is no need to 

legislate changes to a program that is working. EPA needs to implement the program as you wrote it, and the full potential of the 

program will be realized. Don’t be bullied by an incumbent industry intent on recapturing lost market share and preventing a more 

sustainable energy future. Celebrate as I do the success of this program. Thank you, Mr. Chairman. 

[The prepared statement of Bob Dinneen follows:] 

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Mr. WHITFIELD. Thank you, Mr. Dinneen. And our next witness 

is Mr. Todd Teske, who is the Chairman, President, and CEO of 

Briggs & Stratton Corporation. Welcome, Mr. Teske, and you are 

recognized for 5 minutes. 

STATEMENT OF TODD J. TESKE 

Mr. TESKE. Chairman Whitfield, Vice Chairman Olson, Ranking 

Member Rush, and distinguished members of the committee, thank 

you again for inviting me to offer Briggs & Stratton’s perspective 

on the EPA’s implementation of the Renewable Fuel Standard. I 

have been extremely impressed by the committee’s workman-like 

approach to educate itself and the public on the challenges of the 

RFS that it presents to manufacturers, consumers, and the environment. 

The Outdoor Power Equipment Institute on which I currently 

serve as a board member has previously submitted formal comments in response to the committee’s white papers issued in 2013. 

My statement today which is submitted strictly in my capacity as 

chairman, president, and CEO of Briggs & Stratton will attempt to 

define the RFS challenges as they pertain to small engine manufacturers, and offer suggestions on how to protect consumers from significant economic and environmental damage. 

Briggs & Stratton, headquartered in Milwaukee, Wisconsin, is 

the world’s largest producer of gasoline engines for outdoor power 

equipment. We are a leading designer, manufacturer, and marketer 

of power generation, lawn and garden, turf care, and job site products through its Briggs & Stratton, Simplicity, Snapper, Snapper 

Pro, Ferris, PowerBoss, Allmand, Billy Goat, Murray, Branco, and 

Victa brands. 

Briggs & Stratton products are designed, manufactured, marketed, and serviced in over a hundred countries on six continents 

by 6,200 employees. Approximately 5,300 of those employees work 

here in the U.S. As a U.S.-based manufacturer, our company is 

proud to be celebrating its 108th anniversary this year, and continues to manufacture over 85 percent of its products in America. 

Let me first state that Briggs & Stratton has tremendous respect 

for EPA’s career employees. Our engineers and their engineers collaborate on complex emission standard-setting rulemakings, and 

we have found them to be fair and objective in their effort to reach 

the right balance between environmental protection and economic 

reality. 

Achieving that balance is essential to Briggs & Stratton’s over 

5,000 employees in our Kentucky, Georgia, New York, Wisconsin, 

Alabama, Nebraska, and Missouri manufacturing facilities and the 

communities whose economies depend on the revenue generated 

from those plants. 

As is the case with manufacturers of every internal combustion 

engine, our facilities are carefully designed to produce small engines and outdoor power equipment that is designed, warranted, 

and EPA approved and certified to operate on gasoline containing 

not more than ten percent ethanol. 

It is for this reason that we are so deeply concerned about EPA’s 

conditional certification of E15, a fuel which would produce severe 

engine damage if used in our small engine powered products. The 

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partial certification of E15 is not satisfying the industry’s current 

RFS targets. This ensuing process of revising ethanol fuel standards has and will continue to create uncertainty in the marketplace 

for manufacturers and increased misfueling risk to consumers. 

Misfueling will result in economic harm to all parties as engine’s 

failures are met with voided product warranties and changes in 

brand loyalties. These changing targets will result in inefficient use 

of manufacturing resources and more expensive products. 

Following are five factors why we believe that the EPA should 

revisit the conditional certification of E15. One, research has shown 

and EPA has agreed that use of E15 in small non-road engines can 

have harmful and costly consequences on small engines and outdoor power equipment. Two, research on warning label effectiveness suggest that an E15 warning label will do very little to mitigate misfueling. Three, behavioral studies of customers at the gas 

pump conclude that consumers overwhelmingly favor the lowest 

price option regardless of the consequences. Four, misfueling due to 

a lack of education of consumers regarding the proper use of E15 

will be significant. And five, the use of biofuels or, quote, drop-in 

fuels, has been tested and could prevent misfueling. 

If public policy requires that the federal government drive the 

market for alternative fuels, Briggs & Stratton urges that the policy be amended to more fully support the development and use of 

biofuels for many feedstock which are intended to be used as dropin fuels. Drop-in fuels by definition meet existing gasoline specifications and are ready to drop in to infrastructure minimizing compatibility issues. These fuels are capable of satisfying the additional 

growth of biofuel use while also providing a safe and highly performing general fuel for both legacy and newly manufactured small 

engines and outdoor power equipment. 

At our expense we conducted extensive testing with a drop-in 

isobutanol blended gasoline which demonstrated evidence that such 

fuels can provide the performance and operational criteria necessary to remain in compliance with EPA’s emission standards 

without demonstrating any negative effects. It is unfortunate that 

the production of RFS-compliant drop-in fuels has struggled to 

reach commercial scale. I suspect that this is a factor in EPA’s decision to grant the partial waiver to meet the statutory requirements using ethanol. 

In closing, I would like to note that for the past several years we 

have worked closely with our Congressman, Jim Sensenbrenner, in 

an effort to rescind the recertification of E15 until such time as the 

National Academy of Sciences can convene a peer review panel to 

evaluate EPA’s action and recommend alternative approaches 

which protect consumers and the environment. 

This bill along with several others, including the bill introduced 

by Congressman Flores and Congressman Welch, serve to offer a 

variety of options for this committee to work with. I wanted to publicly thank these members of Congress for their work and for their 

dedication to finding creative, common sense solutions to the problems with the RFS. Briggs & Stratton urges this committee to work 

in a bipartisan bicameral manner to pass reform legislation 

through revisions to the RFS which will align domestic goals for 

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biofuel use with the market’s ability to produce, distribute, and 

consume such fuels. 

At a minimum we recommend that the reform legislation rescind 

the partial waiver for E15 and establish gasoline blended with up 

to ten percent ethanol as the general purpose domestic fuel. The 

legislation should also require that all considerations to increase 

domestic biofuel levels in the future be subject to a formal EPA 

rulemaking whereby the market’s ability to safely distribute, retail, 

and consume such fuel is provided. 

Thank you once again for holding a hearing on this important 

issue and for allowing me the opportunity to testify before this distinguished committee. I would be happy to answer any questions 

you and your colleagues may have. 

[The prepared statement of Todd J. Teske follows:] 

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Mr. WHITFIELD. Thank you, Mr. Teske. And our next witness is 

Mr. Brooke Coleman who is the executive director for the Advanced 

Biofuels Business Council, and you are recognized for 5 minutes. 

STATEMENT OF BROOKE COLEMAN 

Mr. COLEMAN. Thank you. Good afternoon, Chairman Whitfield, 

members of the committee. My name is Brooke Coleman. I am the 

executive director of the Advanced Biofuels Business Council. 

Thank you for the opportunity to testify today. We represent worldwide leaders in the effort to develop and commercialize the next 

generation of advanced and cellulosic biofuels. 

I want to start with a general observation about the Renewable 

Fuel Standard. I think it is safe to say that the RFS is a lightning 

rod of sorts; the question is why. There are those who say it is because the RFS doesn’t work. But I think if you look at the success 

rate of innovation and deployment in the renewable fuels industry 

and the historic positioning of the oil industry when it comes to 

trying to avoid competition at the pump you will have your answer. 

In just 10 years, the biofuel industry has emerged to create hundreds of thousands of jobs and displace the need for billions of gallons of petroleum imports annually. If you look at perhaps the most 

criticized biofuel, ethanol, you will find that it also happens to be 

the most disruptive to the status quo. The ethanol industry supports hundreds of thousands of U.S. jobs alone in more than two 

dozen states and now threatens to bring new blends and real consumer choice to the pump. The ethanol industry is a target for a 

reason. 

And now we are innovating. The United States is home to the 

largest commercial cellulosic ethanol plant in the world, DuPont’s 

facility in Nevada, Iowa. POET–DSM cellulosic facility in 

Emmetsburg, Iowa, produces enough renewable electricity as a coproduct to power itself and the grain ethanol facility next door. 

Quad County’s first generation ethanol plant in Galva, Iowa, now 

produces cellulosic ethanol from corn fiber using a technology 

called Cellerate that also reduces energy inputs. Quad County’s 

fuel is 126 percent better than gasoline on carbon. It is a carbon 

sink. 

But disrupting the status quo does not come easily. Our adversaries have enough money to fill the airways with allegations about 

the RFS, but are any of these allegations actually true? We have 

heard about corn ethanol and food prices, but corn prices are about 

the same today as when the RFS was passed, and food industry 

profits—an important part of this—are soaring. 

Higher ethanol blends like E15 could damage cars, they say, except the Department of Energy found no problems with 15 percent 

ethanol blends or 20 percent ethanol blends in 86 cars tested for 

up to 120,000 miles each. Some small engine producers including 

Briggs say they are concerned about ethanol, but they sell their engines to Brazil where gasoline contains more than two times as 

much ethanol as we have in the United States today. 

Oil even ran a commercial during the World Series last year 

claiming that ethanol is worse for the climate than gasoline and we 

heard Congressman Welch say it today, except that USEPA, the 

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California Resources Board, and the national labs like Argonne and 

National Research Energy Laboratory all say they are wrong. 

On the issue of pump prices don’t take my word for it. Former 

Shell Oil president John Hofmeister recently stated, quote, we need 

a competitor for oil. We need to open the market to replacement 

fuels. Competition will drive transportation fuel prices down structurally and sustainably, unquote. 

This is exactly what is happening with the RFS. Energy economist Phil Verleger, he used to advise Presidents Ford and Carter 

and the oil industry itself, recently said, ‘‘The renewable fuels program translates to consumers paying between 50 cents and 1.50 

per gallon less for gasoline, when gasoline prices were high, by 

adding the equivalent of Ecuador to extremely tight world liquid 

fuel markets. 

If there is one thing that we should all agree on it is this. Having 

only one option to power cars and trucks runs contrary to the fundamental premise of competition that underpins our economic system, and if we do not control that resource, as we have seen, it 

leaves us vulnerable to foreign cartels often working against us. 

And that is where I want to close. There are those who want policymakers to believe that quote, things have changed; that we don’t 

need the RFS anymore because the U.S. oil boom and low gas 

prices. But really, nothing has changed. When we got hit with 

record high oil prices in 2008, Americans transferred nearly $1 trillion to OPEC members in just 6 to 8 months paying for motor fuel, 

a predicament that helped throw the United States into deep recession. 

Now Saudi Arabia is hitting us with the other end of the stick 

by intentionally making oil so cheap that U.S. shale and deepwater 

drillers cannot compete, and it is working. U.S. tight oil and deepwater drilling operations are going belly up putting Americans out 

of work. It is nice to pay $1.50 for gasoline, but what is actually 

happening is foreign oil cartels are using their market position to 

snuff out competition and repossess the U.S. fuel energy sector. 

Ironically that is exactly what the oil industry hates about the RFS 

here in the United States, that it threatens their chokehold over 

the American consumer at the pump. 

If I could leave you with one thought it is this. Congress made 

a commitment and investors have spent billions in private capital 

to answer the call to create these biorefineries and create these 

fuels. The RFS doesn’t distort a free market, it corrects a noncompetitive one by forcing choice at the pump. It also happens to 

be the best advanced low carbon biofuel policy in the world. 

What we do not need is for Congress to change a good law. What 

we do need is help convincing the Obama administration to block 

out the noise and administer the program as designed. Thank you 

for the privilege of speaking today and I look forward to your questions. 

[The prepared statement of Brooke Coleman follows:] 

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Mr. WHITFIELD. Thank you very much, Mr. Coleman. And our 

next witness is Mr. Collin O’Mara, who is the President and CEO 

of the National Wildlife Federation. Thanks for being with us. You 

are recognized for 5 minutes. 

STATEMENT OF COLLIN O’MARA 

Mr. O’MARA. Thank you, Mr. Chairman, Vice Chairman Olson, 

and Mr. Tonko. Thank you for having a wildlife voice on this panel 

and a sportsman voice on this panel. When this law was debated 

in 2007 there wasn’t much conversation about land use, and as I 

travel the country I keep having that Toby Keith song in my head, 

‘‘I wish I didn’t know now what I didn’t know then.‘‘ There is a lot 

that we didn’t know in 2007 about land use. 

There is a study by the United States Department of Agriculture 

that said that more than eight million acres that were not in production that were in some kind of habitat are now in production, 

and a big chunk of that is because of the RFS. There is just a study 

from the University of Wisconsin that said that 7.4 million acres 

of habitat has gone into production. 

Sixty seven percent of that land is marginal. These are things 

like grassland prairies. These are things like, some wetlands and 

some forest land. And there are a lot of factors for this, but one 

of the big reasons is this massive drive towards ethanol. Ethanol 

production in terms of the total kind of all of the supply of corn 

that is being produced went from nine percent going towards ethanol before the RFS to 40 percent today. So you are seeing a big 

demand. 

And farmers are rational. I mean, I grew up in a farming community in Upstate New York. If there is a profit there they should 

go there, but it is an artificial one that is being created by government and once again wildlife and sportsmen are the ones that lose. 

Seventy seven percent of these eight million acres that both 

USDA and University of Wisconsin have identified are grasslands. 

And these are incredibly important lands. I mean, you have had 

conversations before this committee and others around the imperiled sage grouse, around the meadowlark. I mean, things that you 

are hearing are having kind of precipitous declines. We are losing 

habitat at a pretty alarming rate. 

Pheasant numbers right now in a whole lot of states are down. 

They had a million, a million birds were shot in Iowa before the 

RFS. There are about 100,000 now. Again there are many factors, 

but the drive for more and more corn on the ground is a big one 

of those and again wildlife and sportsmen end up losing. 

If you only take one thing away from my testimony today it is 

that we have to better understand these land use impacts and the 

water implications. You know, if you look at, if you look right now 

we have lost more than a million acres, 1.6 million acres of native 

grasslands from 2008 until today, and that is bigger than my home 

state of Delaware. I mean that is a lot of land. And when you start 

thinking about those uses it gets kind of scary when these volumes 

continue to go up. 

There was a commitment that this Congress made when we were 

debating this policy originally that there would be no, kind of no 

lands that weren’t in production before 2007 would be affected by 

130 

this policy, and unfortunately though EPA has never upheld their 

end of the bargain. 

They use something that they call aggregate compliance and so 

they basically look at all the acres across the entire country including those that are in the Conservation Reserve Program. They look 

at all these acres and they see whether or not there is any kind 

of impact. They don’t know whether there is forest being lost in 

Wisconsin or Minnesota. They don’t know whether there is wetlands being lost in the Prairie Potholes. They don’t know whether 

there is kind of impacts in Nebraska or Iowa and the grasslands. 

And again wildlife loses over and over again. 

I would also like to talk about water, because one of the things 

that happens when you put more and more corn in production you 

have folks switching from other crops to corn, corn is pretty hard 

on soils. You need a lot of fertilizer to grow corn. And what ends 

up happening is as you have more and more precipitation you have 

that water then wash those nutrients into the waterways and all 

of sudden then you get these big algal blooms. 

Again you have seen record algal blooms. I was with Mr. Latta 

in his district up on Lake Erie. You know, you had algal bloom in 

the state of Ohio, in Toledo that had a half a million people not 

able to drink water for 3 days. Now when you put more and more 

kind of corn on the landscape and you take these acres of grasses 

or wetlands or forest out of habitat into production, you lose that 

value for them to bring up those nutrients. And so this wasn’t supposed to happen. I mean there is very clear language that EPA is 

supposed to take action if there is any kind of economic or environmental harm. They haven’t been doing this because of this compliance approach. 

And so we have three recommendations that we hope the committee will consider. The first one is that—Mr. Welch brought this 

up earlier, we really need to demand the Triennial Report. Now 

there was a report in 2011 that said that the impacts would be 

very inconsequential on the landscape, it is just not true. We have 

verified from academic institutions—and I have no economic stake 

in this. I just want good hunting. I just want good fishing, good 

birding. I want to make sure that we have enough wildlife to pass 

on to our kids. So the first thing, we need that report because what 

it is going to show is that we have lost a lot of acres of habitat. 

The second thing is that we have to have EPA follow the law. 

And you heard today when folks talk about the environmental consequences they only talk about air. You have heard it from EPA 

today, you have heard it from other people on this panel. They 

don’t talk about the land use and the water implications. We need 

to look at all of those. And frankly we need to get that right now, 

because as you have billions of gallons of advanced biofuels coming 

onto the landscape we need to make sure that is also not taking 

more and more land away from hunters, anglers, and wildlife. 

And then the third thing is that we need to make the RFS as 

a statute much more wildlife friendly. We need to make sure we 

get rid of this aggregate compliance mechanism where they look at 

the total land instead of looking at the individual lands that are 

being converted for crops. We need to accurately assess the impacts 

on wildlife. We need to make sure that we are moving the number 

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below the blend wall because we see when we are above that we 

are losing too much land for wildlife. 

And also there is other policies, things like the Conservation Reserve Program that has been cut, things like the North American 

Wetlands Conservation Act, other subsidies, other conservation 

programs that we cut that now some folks say is a good thing. The 

problem is when you cut those things all of a sudden farmers want 

to put their land into production instead of keeping it for habitat. 

So again we have kind of met the enemy and he is us in this 

case. This was a government-created crisis in many ways. Thank 

you. 

[The prepared statement of Collin O’Mara follows:] 

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Mr. WHITFIELD. Thank you, Mr. O’Mara. 

And now our next witness is Ms. Anne Steckel who is Vice President of Federal Affairs for the National Biodiesel Board, and you 

are recognized for 5 minutes. 

STATEMENT OF ANNE STECKEL 

Ms. STECKEL. Chairman Whitfield, members of the committee, 

thank you so much for the opportunity today to testify on behalf 

of the thousands of employees working across the country in the 

biodiesel and renewable diesel industries. 

My name is Anne Steckel, and I am vice president of Federal Affairs for the National Biodiesel Board. I am proud to represent the 

most successful advanced biofuel in America. In fact, biodiesel and 

renewable diesel are the unsung heroes of the RFS Advanced 

Biofuel Program. If you take away one thing from my testimony 

today I hope it is the following. While there are certainly areas 

that could be improved, the RFS has made a tremendous progress 

in developing advanced biofuels and delivering them to American 

consumers. 

Biodiesel and renewable diesel have made up the vast majority 

of the advanced biofuels in the RFS including filling more than 90 

percent in the category in the last 2 years. Last year alone, American consumers used nearly 2.1 billion gallons of biodiesel and renewable diesel. That is 2.1 with a B, out of an overall diesel market 

of about 60 billion gallons. As a result of the RFS many truck stops 

around the country today are selling biodiesel blends of 10 to 20 

percent. In fact, with help from a state program the majority of diesel fuel in Illinois, also my home state, is sold with at least 11 percent biodiesel. 

Biodiesel is a clean, renewable diesel alternative made from a 

wide variety of fats and oils including recycled cooking oil, soybean 

oil, and animal fats. Our industry has plants in nearly every state 

in the country, in big cities and rural communities along the east 

and west coasts and throughout the heartland. Every 100 million 

gallons of biodiesel production supports some 3,200 jobs. 

According to the lifecycle analysis conducted by the EPA, biodiesel reduces greenhouse gas emissions by at least 57 percent and 

up to 86 percent. The California Air Resources Board and other institutions have made similar or even stronger findings. 

Greenhouse gas emissions reductions, however, are just one of 

biodiesel’s many environmental benefits. It also reduces waste in 

landfills, keeps oil and sludge out of sewer infrastructure, maximizes the efficient use of agricultural byproducts, and significantly 

cuts emissions of other air pollutants particularly air toxins. 

Building new energy industries is no small endeavor. Taking a 

biodiesel industry that barely existed a decade ago and building it 

into a commercial scale enterprise is something we should all be 

proud of. U.S. biodiesel producers have made tremendous investments diversifying their feedstocks and increasing efficiency. There 

remains significant untapped production capacity on the ground 

today, and biodiesel producers across the country will tell you they 

stand ready to invest and expand and hire with strong, stable policy. 

147 

I would be remiss if I did not thank the EPA for getting this program back on track from a timing perspective. The stability provided by timely standards is very important. However, we continue 

to believe the agency is underestimating the volume of biodiesel 

that can be delivered. 

First, it is important to remember that biomass-based diesel volumes are currently established under a different process than the 

other RFS categories. The law requires the EPA to set a minimum 

applicable volume for biomass-based diesel 14 months in advance. 

So the most recent RFS proposal covers biodiesel volumes 2 years 

from now in 2018, while covering 2017 volume for other fuel categories. 

Under the pending proposal, the EPA would set a biomass-based 

diesel volume of 2.1 billion gallons for 2018. The industry looks on 

pace to exceed the volume this year and the EPA itself projects 

that we will see 2.5 billion gallons of biodiesel and renewable diesel 

in 2016 and 2.7 billion gallons in 2017. 

The RFS is not a status quo policy. It was designed to drive investment and innovation. We believe EPA can and must implement 

the program to provide aggressive growth. Specifically, we are calling for the EPA to finalize a volume of at least 2.5 billion gallons 

for biomass-based diesel and set more aggressive goals for advanced biofuels. 

I believe the reasons the RFS were initially created are as compelling today as they were then and that biodiesel is leading the 

nation in the transition to clean advanced biofuels. Strong biomassbased diesel and advanced biofuels programs in the RFS are critical to ensure that this success continues. Again I appreciate the 

opportunity to speak with you all today and would be happy to answer any questions you may have. Thank you. 

[The prepared statement of Anne Steckel follows:] 

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Mr. WHITFIELD. Thank you, Ms. Steckel. 

And our next witness is Mr. Tim Columbus, who is the General 

Counsel for the National Association of Convenience Stores and Society of Independent Gasoline Marketers of America. So Mr. Columbus, welcome, and you are recognized for 5 minutes. 

STATEMENT OF TIM COLUMBUS 

Mr. COLUMBUS. Mr. Chairman, members of the committee, thank 

you. My name is Tim Columbus. I am a partner at Steptoe & Johnson and I am here today on behalf of our clients, the National Association of Convenience Stores and the Society of Independent Gasoline Marketers of America. 

From what you have heard so far there seems to be some diversity of view as to the pros and cons of the Renewable Fuel Standard. My clients are the guys caught in the middle. They are caught 

in the middle between two major sources of supply for what they 

sell, and consumers and manufacturers. 

I think it is important for the committee to understand that retailers of motor fuels are for the most part absolutely agnostic 

about what liquid motor fuels we sell. Our objective is to sell legal 

fuels in a lawful way to people who want to buy them. I will tell 

you that for the most part, not uniformly but for the most part, the 

retail segment of the marketplace has been served well by the RFS 

because it has in fact achieved one of the statutory objectives which 

was to broaden and diversify the fuel pool from which my clients 

purchase the products they sell to consumers. Now having said 

that let me move on to the proposal that EPA has put before you. 

At the outset, my market segment along with others is deeply 

grateful to EPA for putting this out on time this year. We are very 

grateful for the recognition by EPA of the existence of a ‘‘blend 

wall.’’ And I have heard some people talk about an ethanol blend 

wall. The way I would define blend wall is there is a lack of RINs. 

There is an inadequate number of RINs to satisfy the demand of 

the obligated parties for RINs. 

And because of the characteristics of this program where an advanced biofuel RIN can be used to retire more than one renewable 

volume obligation, the fact that biodiesel RINs can be used not only 

for advanced biofuel but also to retire other such as corn ethanol 

obligations is an important thing for you all to keep in mind when 

you are talking about a blend wall. So the fact that the RVO for 

gasoline this year has something more than ten percent doesn’t 

mean that will all be satisfied by ethanol. 

For those who want bigger RVOs, I have to tell you that achievement of those numbers is going to be tough and we face as retailers 

two very significant problems. Number one is an infrastructure 

problem. As most of you know, under four percent of the retail outlets in the United States are owned or operated by integrated refining companies. That means our folks own those and invest in them. 

More than half of the retail outlets in the United States have 

changed hands in terms of ownership in the last 15 years. 

The impediment to going on for higher blends of renewables is 

the fact that we have an affirmative obligation under any number 

of regulatory regimes, whether that be a fire code at the state level 

or the Office of Underground Storage Tanks at EPA, to regulations 

153 

to make sure on an affirmative basis that the retailer can demonstrate that the equipment in which he is storing and through 

which he is dispensing these fuels is compatible with those fuels. 

That is really hard. 

Now as to demand for new products, retailers live to satisfy demand. But retailers sell products only because customers want 

them. Customers don’t buy products because retailers offer them. 

If that were true we would offer a lot shabbier stuff and we would 

make more money. The reality is that there are markets in which 

E15 and E85 demand has risen, and in those markets retailers are 

in fact offering the products that the market demands. That is not 

true as broadly as some would have you think. 

Having said all those things, I think we would sum up with EPA 

has done a commendable job from our perspective of doing exactly 

what this committee and Congress in general asked it to do several 

years ago, which was to administer the program as if it were under 

adult supervision and to avoid a blend wall breach which would 

generate truly unpleasant consequences for the marketplace. And 

with that I thank you for your time and I offer to answer any questions you have that I can. 

[The prepared statement of Tim Columbus follows:] 

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Mr. WHITFIELD. Thank you, Mr. Columbus, and thank all of you 

for your testimony. At this time, Mr. Olson, I will recognize you 5 

minutes for questions. 

Mr. OLSON. I thank the chairman and welcome to our second 

panel. I have to correct oversight from the first panel. I want to 

enter a statement for the record from Commander Kirk Lippold. 

Kirk was a navy commander in charge at the USS Cole when she 

was blown up in Aden, Oman, and he submitted a statement for 

me about the effects of RFS on national security. He thinks it hurts 

it, so without objection, sir, I would like to enter that for the 

record. 

Mr. WHITFIELD. Without objection. 

[The information appears at the conclusion of the hearing.] 

Mr. OLSON. Thank you. My first question is for you, Mr. Columbus. First of all, I have to say thank you, thank you, thank you. 

Your organization got me out to see a convenience store, the 

Stripes Store at 12091 Westpark Drive in Houston, Texas. There 

I learned a couple of things. First of all, members of Congress 

should never roll flour tortillas. They get all messed up. 

I also learned that most of your members are not opposed to ethanol as a fuel. They just want to give customers the fuels they 

want and they need. At the same time, some folks point to E85 and 

E15 as our way forward on ethanol. Are most consumers at your 

member stores asking, begging for E15, and could you easily roll 

out the infrastructure for E15 if necessary? 

Mr. COLUMBUS. Mr. Olson, what I have to tell you is it depends 

on the market you are in. You know, all markets are local in demand. If you are in Minnesota or Iowa there are people saying they 

want E15. If you are in Oklahoma there are people who want E0. 

And therefore what you are going to see is retailers across this 

country do what they have been doing for decades and that is responding to what the customers who walk into their establishments 

demand. 

And, while retailers are always appreciative of any money Congress will offer them to upgrade their facilities—I assure you that 

is true—if there is substantial demand for E15 in a marketplace 

you are not going to have to give people grants to upgrade their 

tanks. They will make that because it is in their pecuniary interest 

to do so. That is how markets work. We have not seen the overwhelming demand that I think many people, particularly because 

of flex-fuel vehicles treatment, had anticipated for E85 anywhere. 

Mr. OLSON. Thank you. 

Questions for you, Mr. O’Mara. There is an article today in the 

Houston Chronicle, a study at LS University, Louisiana State, 

about a growing dead zone in the Gulf of Mexico. They say this 

year it will be one-third larger than it was last year primarily due 

to chemical fertilizers running down the watershed from all over 

the Mississippi River Water Basin. That is corn country. 

You said that increased demand for corn ethanol has driven the 

creation of new acreage in some unusual places. Your written testimony talked about the Texas Panhandle, also a fact that 67 percent of new cropland like the Panhandle is marginal or unsuited 

for planting. Can you talk about what this means for Texans at the 

pump, at the grocery store, and at our Whataburgers? 

166 

Mr. O’MARA. Sure. Thank you, Mr. Olson. What you are seeing 

as folks are trying to meet the market demand because they are 

rational, they are trying to make money—we respect that—they 

are planting in more and more places that don’t really make sense. 

And so when you are planting in the Panhandle as you know as 

well as anybody, the amount of irrigation you are going to need to 

try to make that land have any level of production is pretty high. 

Now you have had some water shortages in that part of the country too, and so that is water that ends up hitting in other places 

so then you see higher costs of water, other price impacts, and 

other increasing, both increasing price and also decreasing the 

amount of flow for fish and other wildlife. And so it is kind of bad 

on all fronts when you are growing in these places that we have 

never grown historically because it just doesn’t make sense unless 

there is an artificial government price support. 

Mr. OLSON. OK, yes. Final question for Mr. Thompson. As you 

know, I have long said the RFS is a mandate designed for a world 

that no longer exists. One of ever higher gasoline demand and ever 

lower oil capacity that world is gone. The terms peak oil and peak 

natural gas are not used anymore. And now both Congress and the 

EPA are left trying to cobble together a way forward trying to put 

a round peg in a square hole. 

I know that you believe that EPA has done some good work in 

using its waiver authority to a degree, but do you believe that we 

are on a path that is realistic for your members to comply with 

long term? 

Mr. THOMPSON. Certainly not, and that is why we believe full repeal is due. As I have pointed out in my testimony both written 

and oral, you know, the problem is EPA is for next year’s proposal, 

again just 6 months from now, they are asking to increase the RFS 

by 700 million gallons. It is not feasible particularly when you tick 

down—a lot of folks on this panel talked about creating choice, it 

is really doing the opposite and it is eliminating choice. EPA’s proposal will eliminate E0, something that we know the American consumer wants. It would take it from 5.3 billion gallons down to 200. 

And also Mr. Columbus talks about whether people want E15. 

Well, the truth is it is virtually zero right now and what EPA is 

suggesting will happen in 6 months it will go from zero to 600 million gallons. It is not going to happen. E15 is only sold at 312 

stores today. And then the same with E85. EPA argues that in 6 

months the volume is going to go from 87 million gallons up to approximately 400 million gallons. Consumers don’t want these products. This program is no longer serving the purpose that this body 

created the RFS to tackle. It is time for it to be repealed. 

Mr. OLSON. Thank you. Well, I raise one final point. At the highest levels there could be confusion at the pump. President Obama 

went to Israel a couple years ago. He took his limousines there. 

Guess what, one was broken down by Secret Service guys because 

guess what they did, they put gasoline in a diesel engine. 

Mr. DINNEEN. Congressman, just real quick. With the discussion 

about what consumers want in fuel I will guarantee you there is 

no consumer that wants benzene or xylene or any other toxic aromatics in their fuel either. And so the discussion about what conVerDate Nov 24 2008 12:31 Feb 23, 2017 Jkt 037690 PO 00000 Frm 00172 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 114\114-155 CHRIS
167 

sumers want is interesting, but I assure you, you ask consumers 

they would want a domestic clean-burning fuel additive. 

Mr. WHITFIELD. Thank you. Thank you. 

Mr. OLSON. I yield back. 

Mr. WHITFIELD. The gentleman’s time has expired. At this time 

I recognize the gentleman from Vermont, Mr. Welch, for 5 minutes. 

Mr. WELCH. Thank you very much, Mr. Chairman. I think you 

are right consumers want clean-burning fuel, but Mr. Teske, I will 

ask you. Has the ethanol had any impact on engines? I had a carburetor from a motorcycle that was just gunked up with ethanol according to the mechanic. Tell us your history with that. 

Mr. TESKE. Thank you for the question. Ethanol certainly does 

have an impact on an engine. It really does two different things. 

When you have higher levels of ethanol, say E15 that you would 

put into a small engine, it will run at higher temperatures. These 

engines are really tuned, if you will, for emissions regulations to 

last for a long time and what happens is the higher temperatures 

will distort the material and thereby defeat some of the emissions 

requirements that are out there. 

The other thing that ethanol does because it is alcohol related is 

it attracts water. And so when you have a fair amount of water 

that comes in to an engine it will corrode the engine, you will have 

scoring on the bore. You will have a number of different things. 

Your props, if you will, I am not surprised by. I didn’t see them 

or examine them, but that is very consistent with what we generally see when you introduce higher levels of ethanol. 

Mr. WELCH. It is interesting. I found out about—I didn’t know 

about this issue, but I was up at a county fair and a bunch of 

Vermonters surrounded me. This was years ago after I was first 

elected, and I was clueless about ethanol as I was clueless about 

a lot of other things. But they were insistent that their motorboat 

engines, their chainsaws, and their snowmobiles to some extent 

were really having been damaged by ethanol, so that is all consistent with your experience. 

Mr. TESKE. Yes. 

Mr. WELCH. And my chainsaw got wrecked, and I guess I was 

stupid to leave the ethanol in there a little bit longer than it should 

have been, but my mechanic told—I was pretty blue because I love 

this chainsaw and ethanol does that to chainsaws? 

Mr. TESKE. Yes. So from our perspective obviously our engines 

will run up to E10 and so it is plus or minus five percent, right, 

on each side we can design an engine. So we are not against ethanol, but ethanol does have negative impacts. 

Mr. WELCH. Right. 

Mr. TESKE. The higher the blends the more difficult it is for 

these engines to sustain—— 

Mr. WELCH. Thank you. 

Mr. O’Mara—thank you. We all so want to have our fertile land 

in productive work feeding the United States, feeding other countries. But we had a situation here with ethanol where it was a 

trifecta of governmental policies to encourage this production of 

ethanol. There was the 54 cent a gallon tax incentive, it was the 

45 cent a gallon tariff barrier, and then it was the requirement, the 

mandate that you or I purchase ethanol. And I literally know of no 

168 

other industry that has ever received that trifecta of governmental 

support. A lot of industries might like it, but it is as far away as 

you can get from a free market. 

Now one of the concerns I have had you have talked about, and 

that is that incentive worked. Folks who were in the corn belt saw 

that there was an opportunity and—I don’t have any problem with 

it. Why wouldn’t you if you are a corn farmer? But what happened 

to the overplanting? What happened to the conservation land program that was really being quite successful and with the tradeoff 

where if you put your fragile land out of production you would get 

some help making it with soil conservation and with drainage and 

other things? 

Mr. O’MARA. Thank you, Congressman. Thank you to you and 

Mr. Griffith for raising the wildlife and the land piece. That actually had a fourth and fifth point to your three. We saw massive reductions in the Conservation Reserve Program as you mentioned, 

and you have pretty generous insurance programs as well. And so 

you put that all together and it is again just wildlife bears the 

brunt of that. 

And so we have seen the number of acres in Conservation Reserve go from little, 35–36 million before the RFS; you are around 

25 million right now. Those ten million acres, a lot of which were 

providing very important habitat, is roughly equivalent to the same 

number that Wisconsin and USDA are saying went into production. 

And so, we are losing habitat at again at the expense—because of 

government policy we are doing it ourselves. This isn’t market driven. This is government driven. 

Mr. WELCH. I really appreciate it. What has been tremendous 

about my being involved in this issue was seeing folks who never 

thought they would probably be sitting at the same table. You 

know, you are here, you are here, you guys actually get along, you 

know. Let’s take this model and put it in other places as well. But 

it is in the farm community it is a benefit. If you are a corn farmer 

it is tremendous. 

And I am from a dairy state and I love our farmers. They are 

literally the hardest working people in Vermont. Nobody works 

harder than our farmers, whatever it is. But if you are a corn farmer it has been helpful, but if you are a feed-using farmer it has 

really been a hammer. The margins for our dairy farmers are really tight, and the grain costs which I absolutely believe have been 

affected by 40 percent of corn going into ethanol has increased 

their costs and decreased their security. So I want to thank all the 

panelists for being here. 

Mr. COLEMAN. Congressman, could I provide a response on land 

or is—— 

Mr. WELCH. I think I am out of time. I am sorry. 

Mr. WHITFIELD. That is OK. Go ahead. 

Mr. COLEMAN. Thank you, Chairman. So there is another side of 

this, and as an advocate for advanced biofuels we want to grow responsibly. And I want to just add for the record a couple of different things that my colleague to my left and my colleague a couple seats down has not mentioned. With regard to the land and the 

agricultural footprint, one of the reasons that EPA has not gone 

through an acute analysis of this is because the agricultural footVerDate Nov 24 2008 12:31 Feb 23, 2017 Jkt 037690 PO 00000 Frm 00174 Fmt 6633 Sfmt 6633 F:\MY DOCS\HEARINGS 114\114-155 CHRIS
169 

print in this country continues to decline from an acreage perspective. So I want to correct the record. That doesn’t mean there are 

not acute problems in different places, but Mr. O’Mara has suggested that the RFS is driving the land up and actually the agricultural footprint. And they have done that analysis. EPA has done 

that analysis. 

The other thing that needs to be mentioned here is there is a correlation-causation issue here. It is true that Conservation Reserve 

acres have gone down since 2008 when the RFS went in. What is 

also true is the Conservation Reserve Program which pays farmers 

to keep those acres out of production has been cut from a funding 

perspective and the correlation between those acres in existence 

and being paid to make sure they are existence is a heck of a lot 

stronger than the RFS as the cause for that problem. 

Third and final point, my more fundamental issue with folks who 

are blaming the RFS for all these land-based problems is that 

farmers, which Mr. O’Mara did mention, plant a price. If you are 

getting $8 a bushel for corn versus $4, you want to plant corn. That 

is not for biofuels. That is I can get $8 for corn. What drove up the 

price of corn and all these other agricultural commodities, if you 

look at the correlation it is the increasing price of oil. Why does the 

price of oil go up? It is because we don’t have alternatives. 

And so from a boogeyman perspective, I think with respect that 

the biofuels industry is being blamed for things that are largely the 

response of markets to higher oil prices that happened over the last 

5 years. Thank you for the opportunity to provide that. 

Mr. WHITFIELD. So you said overall farmland has not decreased? 

Mr. COLEMAN. Yes. From year to year USDA with EPA does an 

analysis of the U.S. agricultural footprint, and generally for the 

last 50 years it has been trending down because agriculture has 

gotten more efficient per acre and it continues to trend down. So 

there is not an explosion nationally that is happening. Now if we 

want to start talking about the seven million acres I would be 

happy to converse with my colleague on that as well. 

Mr. WHITFIELD. Mr. O’Mara, what were you going to say? 

Mr. O’MARA. Well, the concern that we have is the virginal habitat. Again, the habitat that has gone into production the last few 

years. I mean, we have lost 1.6 million acres of native grasslands 

that is incredibly important habitat for pheasant hunters and everything else. And so I don’t disagree that the overall that—I do 

disagree. The USDA data shows the acres that we are losing for 

production is actually increasing. Now there are some acres that 

are taken out of production. Since the RFS the acres taken out of 

production are less than the acres being put into production, so 

most of these years so it is several million acres additional. 

But at the end of the day, we are losing forests, prairies, and 

wetlands because folks are trying to meet this higher price, most 

of which is supported by government. This isn’t a global commodity 

price that we are creating. The market here is fundamentally different than other places because of these price supports and the 

points that Mr. Welch made. 

Mr. WHITFIELD. The gentleman’s time has expired. Mr. Griffith, 

you are recognized for 5 minutes. 

170 

Mr. GRIFFITH. Well, I am enjoying this discussion immensely. I 

have to tell you it is exciting when you have environmentalists, 

people who are environmentalists disagreeing with each other. We 

heard comment earlier we have Democrats agreeing with Republicans and Republicans disagreeing with Republicans and Democrats disagreeing with Democrats. So it is an interesting discussion. Surely we must be able to find a balance in there somewhere. 

I have to tell you, in my area some of that land is going out of 

production. And I can’t say it is the only factor, but one of the factors might be the fact that it is hard to guarantee from year to year 

for my cattle farmers and my dairy farmers that their corn price 

isn’t going to spike, and a big part of the concern when it does 

spike is ethanol. And so I can’t say that that is not a legitimate 

concern. 

I also have folks as Ms. Steckel pointed out—nice job—in her 

written stuff to my district that my district does produce some biodiesel. I also had a project that has not been successful that was 

taking hamburger grease, or had the plants take hamburger grease 

and turn that into biodiesel. I think that is exciting stuff. So the 

technology may eventually get there. 

But I am very concerned, Mr. O’Mara, as you may recall from 

our previous conversations, I am very concerned that we are creating problems in the environment and I wish in some ways that 

the EPA would play fair, and let me explain. 

I come from a coal producing district. They had a guideline at 

one point, which was later ruled invalid by the courts, on water 

based on a study in a handful of counties in central Appalachia 

with about seven or eight, nine species of mayflies in which one 

was significantly impacted by runoff water from the coal mines. If 

they did the same thing to ethanol, I think based on what you have 

told me today, Mr. O’Mara, the EPA might be up in arms but they 

haven’t done that report. And I believe your written testimony tells 

us they are 4 1⁄2 years on a 3-year program and no plans to get it 

done. 

What can we do to help push them along to get that report done, 

because I want the data. I want to see a balance and I want to see 

the renewable fuels succeed. I would like to see more of it come 

from non-ethanol biodiesel, but at the same time we are going to 

have some ethanol out there. I don’t think we should shut it down. 

But Mr. O’Mara, what can we do to get the EPA to get us the 

data that we need so that we are able as Congress to make intelligent, appropriate decisions in trying to balance out the concerns? 

Mr. O’MARA. And I thank you for that question and for everything you do for wildlife. I think this committee has to demand the 

report. I think Mr. Welch did, I think you did as well. I mean, I 

think there is data. And also we have to send a very clear signal 

that when we are asking them to evaluate the environmental impacts we are not just talking about air. You have the air administrator here, she is talking about it. And I am here defending her 

a lot of times. I have testified before you several times defending 

EPA on different issues. 

This is indefensible, and I think there is two issues. One is that 

they are not looking at the land and water impacts, and the second 

is that they are not—this aggregate compliance approach, we know 

171 

where coffee comes from. We know where our trees come from, our 

paper products come from. We source these things in every other 

industry. The idea that we can’t know where the corn is coming 

from and whether it is from a virgin prairie or a native prairie or 

it is coming from land that has been farmed for 200 years is crazy 

to me. 

We can do a better—because we know that we are fine by having, if we actually did a good job as long as we are not taking additional habitat, but wildlife shouldn’t have to lose so a couple of industries can win. I mean that is for me the bottom line. 

Mr. GRIFFITH. Well, I think that is important and I hope that we 

can take a look at the effect on the species that you listed in your 

report. And I think it is important to underline again, because it 

is not just those of us that might like to watch wildlife, it is also 

the hunters that are affected. And you said in your opening statement, and I would like for you to repeat that if you would just because we don’t know what insomniac might be watching this hearing sometime late at night. But you gave a number on the ringnecked pheasant hunt in Iowa. 

Mr. O’MARA. Yes. 

Mr. GRIFFITH. They are not usually in my area unless there is 

a stray. But give those numbers again if you would. 

Mr. O’MARA. Yes. So I mean if you went out flushing in Iowa in 

2004, 2005, the bag limit was more than a million; 100,000, the 

last couple years. Again there are many factors, but we are losing 

a lot of their habitat. 

Mr. GRIFFITH. Right. 

Mr. O’MARA. No habitat, no birds. 

Mr. GRIFFITH. Now do you have any data on the fish species that 

might also be impacted? I know Mr. Olson mentioned the dead 

zones that might be impacted in part by this expanse of the cornfields. 

Mr. O’MARA. Yes, so I mean on the freshwater side when you 

have these algal blooms in places like Lake Erie—walleye, perch— 

you are going to see, you are going to see an impact on bass, and 

basically they will go somewhere else. 

And so the problem is that if you had another panel and you invited some of the tour boat captains, the folks that are taking folks 

out on Lake Erie, it is a death knell for them, because if you have 

that amount of runoff coming in and there is more rain so more 

is being washed off, they lose their livelihood. 

And so I mean, we have been working with folks in the Great 

Lakes that are basically saying, look, like we shouldn’t be the ones 

that bear the brunt of this because the walleye are gone because 

they are going further inland which we can’t get to. 

Mr. DINNEEN. Congressman, can you indulge me just for a moment of actual agreement? 

Mr. GRIFFITH. All right, let us hear it. I have got agreement here. 

Mr. DINNEEN. I absolutely agree that it would be a good idea for 

EPA to update much of this analysis. We have been living for years 

with a carbon analysis that the agency did on ethanol in 2007 that 

is just flat out wrong. The science has demonstrably changed and 

we would love for the agency to update that so that we can demonstrate again the significant carbon benefits. 

172 

And I would agree that they ought to do the Triennial Report as 

well and look at all the environmental impacts because we are 

quite frankly pretty confident that it is going to show tremendous 

benefits. I mean, we have talked about what the impacts might be 

on water. Indeed, throughout the RFS the size of the dead zone in 

the Gulf has been shrinking. I don’t know about Lake Erie, but the 

one they usually talk about is in the Gulf and that has been 

shrinking. Farmers have been getting far more efficient. 

So I agree, let’s get the agency to get some of these analyses updated. 

Mr. GRIFFITH. Well, and if I might, Mr. Chairman, if you would 

indulge me, I might say that I agree and it might be nice if the 

EPA would concentrate on these things that they are mandatorily 

supposed to be doing under the code sections instead of going into 

areas they are not supposed to be going into. 

I note that there was a court case came out yesterday where the 

court said they don’t have authority to do what they were doing regarding fracking. You know, OK, people, do what you are supposed 

to do and let us decide where you are supposed to go do something 

different. And I would appreciate it if they would get that done. 

And I am glad that I was able to bring the various parties into 

agreement this morning on that issue if nothing else, and I appreciate it and yield back. 

Mr. DINNEEN. Well, the other place I think we would probably 

see some agreement is that the agency ought to be looking at the 

whole marketplace, because if ethanol as an oxygenate and octane 

enhancer goes away where is our next gallon of fuel going to come 

from? It is going to come from fracking, it is going to come from 

tar sands which also has their own environmental and land use 

issues. And so you have got to look at all of this. 

Mr. WHITFIELD. The gentleman’s time has expired. I might also 

mention that the Inspector General has initiated an investigation 

over at EPA regarding the RFS which I think looks like all sides 

are anxious for them to do what they are supposed to be doing over 

there. So I think that is probably a good development. 

And I will recognize myself for 5 minutes of questions and then— 

Mr. Thompson, some of your member companies are merchant refiners that have no blending capacity. So can you describe just the 

unique challenges those companies face in complying with the 

RFS? 

Mr. THOMPSON. Well, certainly their biggest challenge is that 

they are subject to the whims of the RIN market and as RIN prices 

go up their cost of compliance goes up. And so for a merchant refiner this is the number one compliance obstacle. 

Mr. WHITFIELD. OK. And Mr. Teske, Briggs & Stratton has a 

nice facility down in Murray, Kentucky, and provides a lot of jobs 

as so do our corn growers in Kentucky. And on this small engine 

issue of using fuel above E10 of ethanol content, you say that above 

E10 it does create damage to these small engines and primarily because of a heat issue; is that what you were saying? 

Mr. TESKE. That is correct. So what happens, Chairman, is essentially we design engines that are plus or minus a standard and 

so where we design them is E5, five percent ethanol. They can operate from E0 to E10. We can design to whatever plus or minus 

173 

five percent would be. The problem is a moving target. Our concern 

really comes back to the tens of millions of engines that are out 

there. In fact, there are hundreds of millions of engines that you 

include all small engines that are out there. They are not designed 

to run on anything above E10. 

And so it is these consumers who have bought, paid good money 

for a piece of equipment and now, they are not going to get the 

value and the benefit that they need. So it is the moving target 

that is the issue, but to your point, yes. For the legacy equipment 

that is out there and everything that is being produced today, anything above E10 will cause issues because of heat distorting the 

components, the materials that are in the engine, as well as the 

ethanol attracting water which causes then ultimately corrosion 

and bore scoring and things like that as it relates to the effects of 

corrosion on an engine. 

Mr. WHITFIELD. So do you frequently hear from owners of small 

engines? Do they come back to you as the manufacturer? 

Mr. TESKE. They do. And to Congressman Welch’s point when he 

went to the state fair, people don’t know about the effects of ethanol. And we have done an awful lot of work. We have done here 

studies on do people understand what is happening to their engine, 

and they don’t. They don’t understand. They just look for the 

cheapest thing or they go for whatever they think they have been 

putting in for years. They have an issue. We see more fuel related 

issues. And ultimately they come back and they say, well, this 

must be a problem, Briggs isn’t what they used to be, and in fact 

that is not the case. We are making arguably higher quality engines today than we ever have. In fact I think we do, we have the 

evidence. And ultimately we want to make sure they are getting 

the value that they paid for, and it is going to come back at us and 

they are going to blame us if there are issues when in fact it is a 

misfueling problem. 

Mr. WHITFIELD. Mr. Dinneen. 

Mr. DINNEEN. I would just like Mr. Teske maybe to clarify something for me if nobody else. These problems you are seeing, is this 

with E10 or E15? 

Mr. TESKE. The problems that we—if I may, Chairman? 

Mr. WHITFIELD. Sure. 

Mr. TESKE. The problems we see is with ethanol. And so basically we design the engines to operate on E10, we warrant to E10. 

There are more and more fuel related—— 

Mr. WHITFIELD. So anything—— 

Mr. DINNEEN. That is my point. If you warrant to E10 you 

should not expect an issue with 10 percent ethanol blended gasoline used in your engines. And if there is there has to be some 

other problem. Either they didn’t store it and care for it properly 

or something else. But you would not expect I would assume that 

you would see a problem with E10 if everything was done properly. 

Mr. TESKE. May I? 

Mr. WHITFIELD. Yes. 

Mr. TESKE. This isn’t an issue of E10 or caring for the unit properly. This is we know that when you put higher blends of ethanol 

in up to E15 it will destroy the engine. So people who take care 

of their products, no question. This isn’t a question of whether they 

174 

can use E10 or E15. E15 will harm the engine no matter how well 

you take care of it. When you go to E10, E0 to E10, it will operate. 

You take care of it, it will operate. We do see more fuel related 

issues as ethanol continues, but the fact is, is that our testing 

shows that E15 will damage an engine. 

Mr. DINNEEN. And I was not disputing the fact that E15 should 

not be used in a small engine. I think the question is, is E15 being 

used in small engines today, and I think the overwhelming evidence would be no. As Mr. Thompson pointed out, E15 is only 

being sold at 322 stations across the country. So I just don’t see 

that as driving the kind of problems that he is talking about. And 

if—— 

Mr. TESKE. And Chairman Whitfield, if I may? 

Mr. WHITFIELD. Yes. 

Mr. TESKE. In my written testimony I talk about the fact that 

we see E15 in our area simply because we live in Wisconsin and 

there is a lot of corn. If you go back and look into the ’70s and the 

’80s when leaded gasoline transitioned to unleaded gasoline, there 

are a lot of issues, a lot of misfueling problems along the way. 

We are trying to avoid that from happening again, and that is 

why as we go down in our recommendations to this is ultimately 

better education, make sure people understand, and make sure 

that there is E10 that is widely available so that these tens of millions of our engines and hundreds of millions of engines that are 

out there can work. 

Mr. WHITFIELD. Mr. Columbus, if I own a small minute market 

and I want to put in E85, what would that equipment cost me 

roughly? 

Mr. COLUMBUS. Mr. Chairman, it will depend on where you are 

putting it and where that market is. 

Mr. WHITFIELD. Yes. 

Mr. COLUMBUS. If it is in a rural area you are probably looking— 

and remember size of the outlet. If you are putting in a Sheetz or 

a Wawa it is going to be a couple, $300,000 anywhere. If you are 

going to have four to six fueling locations you are probably looking 

between $50,000 and $100,000. But if you are looking at an outlet 

that small $50,000 to $100,000 is all the money on earth. 

Mr. WHITFIELD. That has—yes. 

Mr. COLUMBUS. So unless and until somebody demonstrates that 

they can get a return on investment on that money it is not going 

to happen. 

Mr. WHITFIELD. OK. 

Bobby, do you have any questions? 

Mr. RUSH. I think I have one question, Mr. Chairman. 

Mr. WHITFIELD. The gentleman from Illinois is recognized for 5 

minutes. 

Mr. RUSH. Mr. Dinneen, in your testimony earlier you cited the 

successes of the RFS program especially when it comes to the issue 

of jobs. And would you elaborate on how this policy has helped spur 

the creation of jobs and what impact would amending or ending 

this program have on employment? 

Mr. Thompson, you can jump in on this if you would. But Mr. 

Dinneen, I really want you to—jobs are critical to my constituents. 

175 

Mr. DINNEEN. Certainly, Congressman. The U.S. ethanol industry is responsible for about 380,000 direct and indirect jobs. Many 

of those jobs are in agriculture as farmers grow and deliver the 

corn. There are certainly high paying jobs, high tech jobs at the 

plants themselves. 

But what we have seen is that when an ethanol plant is introduced to a community it revitalizes that rural community with 

high paying jobs. I have been to ethanol plant openings all across 

the country and, you know, rural America was losing population. 

There was no economic development. An ethanol plant in these 

areas is an economic engine that revitalizes those areas in demonstrable ways. 

Mr. RUSH. Mr. Thompson, do you have anything you want to add 

to that? 

Mr. THOMPSON. Well, this shouldn’t be about whether we support 

jobs. Certainly we all support jobs. My industry supports over two 

million jobs. The issue is whether this should be congressionally 

mandated, right. As Mr. Dinneen says he has a thriving industry 

and that industry should be able to thrive on its own. It shouldn’t 

have to rely on this, you know, congressional mandate. So we support the jobs. 

Mr. RUSH. Thank you, Mr. Chairman. I yield back. 

Mr. WHITFIELD. The gentleman yields back, and that would conclude today’s hearing. And I want to thank the witnesses for being 

with us today. As I said in the beginning, this was kind of a status 

hearing to let everybody air it out and talk about it from their perspective, and I think we accomplished that. So I want to thank you 

very much for your time and effort. 

Also I want to enter into the record a letter from the Advanced 

Biofuels Association; a letter for the record from Growth Energy; 

the National Farmers Union; the National Council of Chain Restaurants; a statement from Representative Steve King of Iowa. 

[The information appears at the conclusion of the hearing.] 

Mr. WHITFIELD. And we will keep the record open for 10 days. 

Mr. RUSH. Mr. Chairman. 

Mr. WHITFIELD. Yes. 

Mr. RUSH. I have a report that I would like to enter into the 

record. It is the Biotechnology Innovation Organization’s study on 

greenhouse gas reductions from the RFS. 

Mr. WHITFIELD. Yes. Without objection, we will enter that into 

the record as well. 

[The information appears at the conclusion of the hearing.] 

Mr. WHITFIELD. Anything else? OK. 

OK. Well, thank you all once again. We look forward to working 

with you as we move forward and appreciate your time very much. 

Thank you. 

[Whereupon, at 1:11 p.m., the subcommittee was adjourned.] 

[Material submitted for inclusion in the record follows:] 

PREPARED STATEMENT OF HON. FRED UPTON

This committee takes seriously its oversight duties, and today we will give the Renewable Fuel Standard a much-needed review. I welcome Environmental Protection 

Agency Assistant Administrator Janet McCabe, Energy Information Administration 

176 

Deputy Administrator Howard Gruenspecht, as well as a cross section of stakeholders who will be providing their perspectives on this program. 

It has been 9 years since the RFS was last revised in 2007, and it goes without 

saying, much has changed since then. Widespread fears at the time that America 

was running out of oil have been replaced with the reality of rising domestic production and even the U.S. is now exporting crude oil for the first time in four decades. 

Concerns about rising gasoline demand have been replaced by declines in actual 

usage, and assumptions that cellulosic biofuels were just around the corner have 

been replaced with very slow development of these fuels. Overall, we find ourselves 

in a very different place today than anticipated when we last legislated changes to 

the RFS. 

Of course, just because circumstances have changed does not necessarily mean the 

RFS needs to be revised, but it does mean that we should take a careful look at 

the program. And no questions or ideas for improvements should be off the table. 

One topic that warrants serious discussion is the fate of the program after 2022. 

The law sets out the requirements through 2022, but afterwards it essentially gives 

the reins to EPA. I suspect many of us are concerned about having that much discretion in the hands of unelected bureaucrats, and now is a good time to start the 

discussion on potential changes to this aspect of the RFS. 

We all know that there are those who call for complete repeal of the RFS, and 

there are those who don’t want any changes at all, even modest ones. But I can’t 

help but think that if we approach this issue in a bipartisan fashion, that we can 

find a path forward for an RFS that works for all the parties involved—farmers, 

renewable fuel producers, refiners, automakers, power equipment makers, and most 

of all consumers. 

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PREPARED STATEMENT OF HON. STEVE KING

I want to thank Chairman Whitfield and Ranking Member Rush for accepting my 

testimony today on the importance of maintaining the RFS program. 

Energy is at the heart of the American economy. Energy powers our homes and 

businesses, and it is vital that America has access to the most affordable and most 

extensive sources of energy possible. Moreover, our national security is also tied to 

the energy sector. If we rely on sources of energy that come from abroad, then we 

expose our nation to the whims of tyrants and terrorist sponsoring states. The Renewable Fuel Standard (RFS) was created with these goals in mind: to promote the 

development of affordable, low pollution, domestically produced fuel sources. Not 

only have these goals been met thus far, but the RFS and the work and innovation 

of our biofuels industry over the last few decades has allowed the fields that have 

fed the world, to fuel it as well. 

To examine further the benefits of the RFS, I want to highlight an academic work 

done by professors Dermot Hayes of economics and finance at Iowa State University, and Xiaodong Du of the Department of Agricultural and Applied Economics at 

the University of Wisconsin-Madison. Their analytical report entitled ‘‘The Impact 

of Ethanol Production on US and Regional Gasoline Markets: An Update to May 

2009’’, showcases the breathtaking and positive effects that ethanol and the RFS 

have had for the American economy. Their work concluded that in 2010 alone the 

effect of ethanol being blended into the fuel market lowered the price of the average 

gallon of gasoline by $0.89, saving Americans around $120 billion per year at the 

pump. They also concluded that if ethanol were suddenly removed from the fuel 

market altogether, the resulting gasoline price spike would be between 41% and 

92%, crippling the US economy and almost certainly plunging our fragile economy 

back into recession. 

Beyond the substantial economic benefits for American families, a Congressional 

Research report from 2012 asserts that in the first six years after the implementation of the RFS oil imports declined by 33%. Furthermore, this report forecasts that 

over the next 20 years US oil imports will be less than a third of what they would 

have been expected to be prior to passage of the RFS. This dramatic decrease in 

imported oil helps to safeguard the national security interests of the United States 

by insulating our economy from the supply shocks and price volatility that is intrinsic to the world’s petroleum market. Due to the irregularity of global production of 

crude and refined petroleum products, a reliance on these goods for energy exposes 

our nation to possible catastrophe. The oil crisis of the 1970s and the resulting stagflation serve as a warning and a reminder of the danger of relying on a 100% petroleum mandate. The oil crisis of the 1970s also reminds us of the damage that Iran, 

a known state sponsor of terrorism, can inflict on the US by manipulating their oil 

production. The RFS has tremendously reduced the amount of US dollars that have 

been sent to terrorist sponsoring nations, such as the Islamic Republic of Iran. 

There is no serious doubt that if we had the RFS and our present biofuels industry 

in the 1970s, it would have substantially mitigated the very serious damage to our 

economy while, at the same time, limited or even eliminated the Great Farm Crisis 

of the 1980s. 

In my home of Iowa we all know the benefits of biofuels that I have outlined here, 

but unfortunately not everyone does. This is why I have championed the fight to 

maintain the original volumes of biofuels in the RFS. The biofuels industry has created countless American jobs and has spurred economic growth across our country. 

The biofuels sector has directly added $5.6 billion of GDP and 62,000 jobs to the 

state of Iowa alone. In Iowa we produced about 30% of the nation’s ethanol, saving 

Americans tens of billions of dollars at the pump each year. Furthermore, we can 

thank the ethanol industry for having reduced the annual carbon footprint of the 

United States by the equivalent of 27 million cars. It is thus imperative that the 

RFS not only continue to remain a policy of the United States, but one that is administered in accordance with established law. 

Unfortunately, this Administration, in a blatant violation of Congress’s Article I 

authority and in contravention of established US law, has begun to alter the RFS 

based on biased and arbitrary positions. Whether or not you agree with the plethora 

of hard science and academic work that illustrates the positive effects of the RFS, 

we must stand firm against the abuse of the program by this administration. It is 

with this in mind that I must stand in opposition to H.R. 5180, a bill that would 

reward this administration by enshrining into law the very abuse that this President has committed thus far. H.R. 5180 would grant legal cover to the EPA to continue its currently illegal policy of arbitrarily reducing the level of biofuels in America’s fuel economy. The effect of this bill would be to undo the progress of the 

biofuels industry and the RFS thus far. The President’s abuse of the program has 

220 

already stunted economic and job growth, leaving fuel prices high, and our nation 

more susceptible to foreign manipulation of the oil markets. H.R. 5180 would raise 

the petroleum mandate to 90.3%, weakening the United States and increasing the 

probability of another oil and economic crisis, similar to that of the 1970s. H.R. 5180 

would only serve to aid this President in these endeavors, and to weaken our nation. 

I urge Congress to preserve our Article I authority, and hold firm to established 

law. It’s time to reaffirm our support of the RFS; a program that has improved the 

quality of life of every American, and strengthened our national security. The RFS 

has been great for Iowa and great for America. It is the only tool that provides market access to ethanol and other renewable fuels so they can be sold in competition 

with the petroleum industry, which has benefited from a century of Federal subsidies and support. It strengthens our national security, decreases our dependence 

on foreign sources of energy, gives consumers lower cost options at the pump, and 

creates jobs for Americans. To weaken, reduce, or eliminate the RFS, as HR 5180 

does, moves the US in the direction of a 100% petroleum mandate. 

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