Ethanol producers could face tougher standards

Administration officials proposed a rule Tuesday that may make it harder for ethanol producers to meet greenhouse gas emissions standards in a 2007 energy law.

The decision to factor in “indirect land use changes” could raise ethanol’s carbon footprint higher than that of conventional gasoline production, and could limit future production of corn-based ethanol in particular. In theory, farmers grow crops in an area that was once forest or grassland to make up for the food lost when corn is grown to make fuel.

{mosads}The news wasn’t all bad for the industry. The administration also announced the creation of an interagency task force designed to speed the development of the alternative-fuel industry. Bob Dinneen, president and CEO of the Renewable Fuels Association, called the group a “very positive step for the industry.”

But Dinneen also criticized a move to weigh indirect land use changes, saying they rely on faulty assumptions to be a reliable standard.

Administration officials said they would release a notice of proposed rulemaking later Tuesday that will implement the Renewable Fuels Standard (RFS) included in the Energy Independence and Security Act of 2007 (EISA). The act requires that refiners blend 36 billion gallons of biofuels by 2022. Not more than 15 billions gallons could come from corn-based ethanol, a fuel with a large constituency of supporters on Capitol Hill but also a number of critics who argue it is uneconomical compared to gasoline and is not beneficial to the environment.

Environmental Protection Agency Administrator Lisa Jackson said the proposed rule would also include instructions on how ethanol producers could meet the greenhouse gas emissions cuts relative to gasoline, as called for in EISA.

The act requires that new corn-based ethanol plants reduce carbon emissions by 20 percent compared with gasoline, although most of the 15 billion gallons would be grandfathered in under the law. Advanced biofuels like cellulosic ethanol would have to show a 50 percent greenhouse gas reduction to qualify under the RFS.