Michael R. Penee Goverrzor STATE OF INDIANA OFFICE OF THE GOVERNOR State House, Second Floor ^•• -... . •^^'' lndianapolis, Indiana 46204 tds

January 21, 2014

Administrator Regina A. McCarthy Environmental Protection Agency 1200 Pennsylvania Ave., NW Room 3000 Washington, DC 20460 Email: Mccarthy.gina@epa.gov

Dear Administrator McCarthy:

As Governor of the State of Indiana, I am concerned about the U.S. Environmental Protection Agency's (EPA) proposed rule announcement that would significantly reduce the volumes of coin-based ethanol and biodiesel produced in the U. S., specifically in Indiana.
This announcement, if implemented, will hinder Indiana's development efforts to sustain and grow jobs in rural communities across the state. The growth of our state's ethanol and biodiesel industry in the last nine years has reinvigorated 13 comniunities, directly and indirectly, arld created more thari 3,000 jobs.
The proposed reduction iri ethanol volume is almost eguivalent to the total ethanol production by Indiana's 13 plants. The potential damage to soy-based biofuels is even more signiEcant and threatens the nation's largest biodiesel plant, which is located here in Indiana. Hoosier farmers report that this proposed cliange comes after they have harvested their 2013 crop and made plans for deliveiy to our ethanol and soy biodiesel plants. This leaves them trying to figure out how to adjust to this unantieipated rnarlcet reduction.
Because ethanol represents the second largest market for Indiana corn farmers, the EPA's proposal represents a severe shift in rural economic policy in our state. It has already had a chilling effect on those companies who are pursuing second generation biofuels fiorn biomass, and if implemented, it would halt investment in additional infrastructure that would lead to more jobs in America's heartland. In addition, corn prices have been dropping steadily in recent months and are now approaching the fai • mers' cost of production, which is further evidence that now is a bad time to abruptly alter the marlcet for corn.
.My concerns about the EPA's proposal are sincere and heartfelt, and so is my interest in working with you on a sensible resolution. We share the goal of offei • ing consumers more fuel choices, and renewable fuels are on the cusp of solidifying their role inachieving that goal. Blender pump installations are increasing, as is the number of

flex-fuel vehicles available to consumer. Just as we have seen in many other industries, the biofitels industry continues its steady advancements with new technologies that malce such production ever more efficient and valuable to many markets and customers. I encourage the ethanol industry to continue making technological strides in process, development, and use, and I ask that the EPA work together with industriy leaders on a solution that advances both parties' long-term objectives. The long teim future is bright for these fuels and the technology behind them, and I believe we can worlc together to make that future a reality.

Adininistrator McCarthy, I m • ge the EPA to halt this proposed action and work with us and other interested stakeholders in rural America to find ways to continue growing America's biofuels industry and increasing our nation's energy security.

Sincerely,

J' L

..., .,L.^._.. Michael 4 RPenee Govemor of Indiana

ce: Tom Vilsack, Secretaty, United States Department of Agriculture

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