DES MOINES, Iowa (AP) — The latest federal proposal to increase the levels of renewable fuels blended into the U.S. gasoline supply must be increased or it will stifle economic growth, Iowa politicians and industry groups said Wednesday in response to the plan.
Iowa Gov. Terry Branstad, whose state is the nation's top ethanol producer followed by Nebraska, Illinois, Minnesota and Indiana, said he was disappointed by the levels announced Wednesday by the Environmental Protection Agency. The agency oversees the Renewable Fuel Standard program, which aims to increase levels of corn-based ethanol and other renewable fuels blended into gasoline, in part to reduce dependence on foreign oil.
"While we're encouraged that the EPA made slight increases with the volume levels, their proposal falls far short," Branstad said in a statement.
The latest proposal increases production of all types of biofuels in 2017. It also increases biomass-based diesel levels for 2018.
The EPA has made proposals annually with criticism along the way. The ethanol industry has pushed back any proposals that would have decreased the amount of ethanol mixed into fuel. Oil companies have also challenged the law, while environmental groups have questioned the impact on land by using large amounts of corn for ethanol production.
Sen. Charles Grassley of Iowa said the latest numbers are below levels sought by Congress when it passed legislation in 2007.
"Policy ought to encourage innovation and investment so fuel diversity will continue moving forward," he said in a statement.
The EPA said in a press release the proposed levels boost production and provide for "ambitious yet achievable growth." The agency has said in the past that the original standards set by law cannot be fully reached due partly to limits on the amount of renewable fuels other than ethanol that can be produced.
Janet McCabe, acting assistant administrator for EPA's Office of Air and Radiation, said in a statement her administration "is committed to keeping the RFS program on track, spurring continued growth in biofuel production and use, and achieving the climate and energy independence benefits that Congress envisioned from this program."
The EPA will hold a public hearing on the proposal in June. It will make a final decision later this year.
Monte Shaw, the executive director of the Iowa Renewable Fuels Association, said in a statement he looked forward to the upcoming public comment period. He highlighted his organization's own study that he says shows the industry's benefits to revenue and jobs in the state.
"Today's proposal represents yet another missed opportunity for consumers, energy security and rural America," he said.