Court says EPA overestimates biofuels production

MARY CLARE JALONICK

Asso­ci­ated Press

WASHINGTON — A fed­eral appeals court has ruled that the Envi­ron­men­tal Pro­tec­tion Agency is over­es­ti­mat­ing the amount of fuel that can be pro­duced from grasses, wood and other non­food plants in an effort to pro­mote a fledg­ling bio­fu­els industry.

At issue is a 2007 renew­able fuels law that requires a cer­tain amount of those types of fuels, called cel­lu­losic bio­fu­els, to be mixed in with gaso­line each year. Despite annual EPA pro­jec­tions that the indus­try would pro­duce small amounts of the bio­fu­els, none of that pro­duc­tion materialized.

There have been high hopes in Wash­ing­ton that the cel­lu­losic indus­try would take off as farm­ers, food man­u­fac­tur­ers and oth­ers blamed the sky­rock­et­ing pro­duc­tion of corn ethanol fuel for higher food prices. Those groups said the diver­sion of corn crops for fuel pro­duc­tion raised prices for ani­mal feed and even­tu­ally for con­sumers at the gro­cery store. Law­mak­ers hoped that non­food sources like switch­grass or corn husks could be used instead, though the indus­try hadn’t yet got­ten off the ground.

The 2007 law man­dated that bil­lions of gal­lons of annual pro­duc­tion of corn ethanol be mixed with gaso­line, even­tu­ally tran­si­tion­ing those annual require­ments to include more of the non­food, cel­lu­losic mate­ri­als to pro­duce the bio­fu­els. As crit­i­cism of ethanol has increased, law­mak­ers and even Pres­i­dents George W. Bush and Barack Obama have talked of the cel­lu­losic mate­ri­als as the future of biofuels.

But the cel­lu­losic indus­try stalled in the bad econ­omy and still hasn’t pro­duced much. Accord­ing to final EPA esti­mates, no cel­lu­losic fuel was pro­duced in 2010 or 2011. Last year’s esti­mates aren’t yet available.

“What you have in our indus­try is a tech­nol­ogy that is ready to go but has had a hard time punch­ing through com­mer­cially because of a very chal­leng­ing global finan­cial cli­mate,” said Brooke Cole­man of the Advanced Ethanol Coun­cil, which rep­re­sents com­pa­nies try­ing to pro­duce cel­lu­losic fuel. Cole­man said there are bet­ter hopes for 2013 as sev­eral plants are com­ing online.

The court faulted the EPA for set­ting last year’s pro­jec­tions at 8.7 mil­lion gal­lons even though the two pre­vi­ous years had shown no pro­duc­tion, and also for writ­ing in the rule that “our inten­tion is to bal­ance such uncer­tainty with the objec­tive of pro­mot­ing growth in the industry.”

Judge Stephen Williams on Fri­day threw out too-high EPA esti­mates in response to a chal­lenge filed by the Amer­i­can Petro­leum Insti­tute, which rep­re­sents the oil industry.

Williams, an appointee of Pres­i­dent Ronald Rea­gan, said the law was not intended to allow the EPA “to let its aspi­ra­tions for a self-fulfilling prophecy divert it from a neu­tral methodology.”

The court rejected the oil industry’s argu­ments that the EPA also should have low­ered the total pro­duc­tion require­ment for renew­able fuels once the cel­lu­losic goals were not met, say­ing the EPA had author­ity to main­tain those requirements.

Still, the oil indus­try praised the decision.

“The courts have reined in a man­date for bio­fu­els that don’t exist,” said Bob Greco, down­stream group direc­tor for the Amer­i­can Petro­leum Insti­tute, which brought the case. “It’s a voice of reason.”

Posted by AP News on Jan 25 2013. You can follow any responses to this entry through the RSS Feed. Comments can be made below.