EPA looking to change ethanol projections
Two weeks ago, the EPA announced it would maintain ethanol production levels next year, but there's no guarantee beyond that.
That could eventually impact ethanol demand and the future of North Dakota's five ethanol plants.
Rather than directly changing how much ethanol will be used, the EPA announced it's looking to change how projections are being calculated. Which could affect how much will be legally obligated to be blended.
EPA Administrator Andrew Wheeler saying, "Today's agreement is the latest in a series of steps we have taken to expand domestic energy production and improve the RFS program that will result in sustained bio fuel production to help American farmers."
However, opponents of the change say this would cut the promised amount of bio fuels each year in half; down 600 million gallons. After missing the target last year, the bio fuels industry expected those off-set gallons to be replaced over three years.
"We think this approach of giving exemptions where due, maybe adding some transparency around that, but then accounting for those gallons that were exempted and then bringing them back into the balance of the volume obligations is really what the intent of the law originally stated. So we think this is the right approach," said Jeff Zueger, ND Ethanol Council chairman.
Zueger went on to say that the industry is optimistic that the move will help recover production that was lost over the years.
Who does the calculations would change as well. They will soon be based on recommendations from the Department of Energy, headed by Secretary Rick Perry. Who, while serving as the Governor of Texas, asked for 50 percent of Texas' ethanol mandate be exempt under the same law.
In a statement, Governor Doug Burgum said, "This agreement strikes a balance for our farmers, ethanol producers and refiners, protecting demand for renewable fuels while still allowing for exemptions for small refineries."
Adding that it will help with developing year-round E-15; a major platform for the ethanol industry.
A public comment period will open at the end of the month.