MSGA befuddled by EPA ruling

The Environmental Protection Agency has released its draft “set” rule, which sets annual biofuel blending targets under the Renewable Fuel Standard. This announcement, including proposed Renewable Volume Obligations for 2023, 2024 and 2025, is deeply disappointing for the Minnesota Soybean Growers Associations and its supporters in the biofuels industry. EPA’s ruling threatens the integrity of the RFS by significantly dialing back annual increases in volume obligations.

“I don’t understand this decision. We all know biodiesel has been around for 20 years in Minnesota, so why aren’t we promoting the heck out of it and using more of our product that’s cleaning our air and improving our economy?” MSGA President Bob Worth said. “It’s nice to see it increased but it should be increased way more.”

Congress created the RFS program starting in 2005 “to reduce greenhouse gas emissions and expand the nation’s renewable fuels sector while reducing reliance on imported oil.” However, this latest decision by EPA appears to contradict that intention and could leave farmers and biofuels industry partners who have invested in the government’s goal in the lurch.

“America’s farmers have committed to the renewable fuels industry while continuing to provide the feed and food our country and other countries must have. Billions of dollars have gone into building and growing the infrastructure needed to support this industry. And our president has made a clear commitment to mitigating climate change and lowering greenhouse gas emissions — the very tenets of the RFS,” said Brad Doyle, ASA president and soy grower from Arkansas.

“And, yet, this draft rule slams the brakes on progress being made in biofuels investment and growth. Instead of continuing to support available, low-emission plant-based fuel sources, EPA has changed course and seemingly is ignoring the major investments in and consumer demand for biomass-based diesel and other biofuels that exists right now,” Doyle continued.

Soy farmers were heartened by EPA’s 2022 volume target — which included the highest-ever number for total renewable fuels and specifically for biomass-based diesel (BBD) since the renewable fuel standard was created — and were hopeful EPA would stay the course on a rising trajectory.

This year’s new set rulemaking process is the first in which Congress no longer specifies RFS volume targets, providing EPA more flexibility in the decision. However, since 2013 EPA has been able to raise BBD requirements above the one billion gallon minimum set in statute.

This chart demonstrates the about-face EPA has made in terms of reaffirming its commitment to BBD. Even more, EPA has proposed halting any growth for advanced biofuels outside of BBD and cellulosic biofuels. The multi-year set rule was intended to provide more certainty for the biofuels industry and encourage investment and innovation. Contrarily, these very insignificant volume increases for 2023-2025 realistically could not only stifle growth but also jeopardize the existing biofuels industry.

Through a consent decree submitted by EPA and Growth Energy, EPA is required to release the final set rule by June 14, 2023. EPA will solicit public comment on the proposed rule and hold a public hearing in January.

Earlier this year, Minnesota celebrated the 20th anniversary of biodiesel becoming law, making Minnesota soybean farmers a national leader in promoting the homegrown fuel. Using a 20% biodiesel blend in the summer and a 5% biodiesel blend in the winter removes an estimated 1,252,967 tons of CO2 from the air. Additionally, biodiesel contributes nearly $1.7 billion toward Minnesota’s economy and boosts demand for soybeans by 13%.

“This ruling doesn’t recognize the carbon reductions that could be had now, if the EPA would have set more aggressive volumes of biodiesel,” said Mike Youngerberg, executive director of the Minnesota Biodiesel Council and one of the nation’s leading biofuels experts. “More biodiesel means more jobs, more market opportunities for soybean farmers and less carbon in the air.”

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